-PRINCIPLES    OF 

CITY   LAND  VALUES 


/.^vl^> 


BY 

RICHARD    M.    HURD 

President,   The  Lawyers'  Mortgage  Insurance  Co. 


PUBLISHED    BY 

THE   RECORD   AND   GUIDE 

NEW   YORK 

^903) 


•      •   •      • 
•  •    •  •  •• 

'   •  •  •/  • 
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1 


r:sRAL 


Copyright,  1903, 
By   Real   Estate   Record   Association. 


Example  of  highest  type  of  Improvement  of  short  block  front. 
A  skyscraper  on  each  corner  and  a  low  building — controlled  by  one 
or  both  of  the  skyscrapers— in  the  middle,  giving  a  light  well  above. 
Broadway,    between   Cedar   and    Liberty    Streets. 


Principles   of  City  Land  Values* 

Preface. 

When  placed  in  charge  of  the  Mortgage  Department  of  the 
U.  S.  Mortgage  &  Trust  Co.  in  1895,  the  writer  searched  in  vain, 
both  in  England  and  this  country,  for  books  on  the  science  of 
city  real  estate  as  an  aid  in  judging  values.  Finding  in  economic 
books  merely  brief  references  to  city  land  and  elsewhere  only 
fragmentary  articles,  the  plan  arose  to  outline  the  theory  of  the 
structure  of  cities  and  to  state  the  average  scales  of  land  values 
produced  by  different  utilities  within  them. 

The  material  for  this  study  of  the  structure  of  cities — includ- 
ing their  locations,  starting  points  and  lines  of  growth — has 
been  gathered  from  a  large  number  of  local  histories  of  Ameri- 
can cities,  old  maps,  commercial  geographies,  &c. 

The  material  for  the  study  of  average  scales  of  values  has 
been  drawn  from  the  mass  of  valuations  of  land  and  buildings, 
rentals  and  mortgages,  obtained  in  about  fifty  cities  in  the 
course  of  the  mortgage  business  of  the  U.  S.  Mortgage  &  Trust 
Co.  and  also  from  many  visits  to  these  cities. 

The  viewpoint  is  that  of  a  conservative  lender  on  real  estate 
and  while  the  examples  cited  are  chiefly  from  the  smaller  cities, 
it  is  believed  that  the  principles  stated  are  universal  and  differ 
only  in  application  and  in  resulting  combinations. 

Special  acknowledgment  is  due  for  aid  in  figuring  the  struct- 
ural and  commercial  value  of  buildings  and  in  the  preparation 
of  maps,  to  Cecil  C.  Evers,  late  member  of  the  American  Insti- 
tute of  Architects. 


'..'  i\  u  » 


Table  of  Contents. 

CHAPTER  I.— General  Principles 1 

Economic  rent  the  basis  of  value.— Urban  economic  rent  the 
residuum  after  payment  of  all  charges  and  interest  on  build- 
ings.—Intrinsic  vs.  exchange  value.— Utility  precedes  value 
in  city  land.— Ground  rents^  based  on  social  service  of  loca- 
tions.—Structure  of  cities  controlled  by  definite  laws.— Cities 
originate  at  point  of  contact  with  outer  world,  and  grow  in 
line  of  least  resistance  or  greatest  attraction  or  their  result- 
ant—Central or  axial  Growth.— Influence  of  buildings.— Final 
basis,  psychological. 

CHAPTER  n.— Forces  Creating  Cities 19 

Defence  against  enemies.— Commerce. — Manufacture. — Political 
forces.— Social  forces,  i.e.,  culture,  education,  art,  fashion, 
amusfements.— All  forces  intermingled  in  the  larger  cities.— 
Final  basis,  energy,  enterprise  and  intellect  of  people. 

CHAPTER  III.— Locations  of  bities 22 

Situations  for  defence  originally  most  important.— Later  trade 
routes  located  by  topography  create  commercial  cities,  where 
break  in  transportation  occurs. — In  manufacturing,  extractive 
Industries  follow  raw  materials,  and  cheap  power,  and  later 
seek  the  largest  cities  for  labor  supply,  home  markets  and 
cheap  transportation.— Political  locations  compromises.— ETx- 
act  starting  points  analyzed. — Topographical  influences  most 
compelling. 


CHAPTER  IV.— Ground  Plan  of  Cities 33 

First  influence  consists  of  topographical  faults,  i.e.,  water  sur- 
faces or  sharp  variations  from  levels.— Characteristics  of 
platted  cities,  straight  streets  at  right  angles,  permitting 
free  movement  throughout.— Characteristics  of  haphazard 
growth,  irregular  tangle  of  crooked  and  narrow  streets  pre- 
venting quick  access  to  business  center.— Some  early  plats 
attempt  to  forestall  later  needs  and  some  to  determine  cen- 
ter of  city.— Normal  sizes  of  streets,  alleys,  blocks  and  lots: 
percentage  of  public  and  private  land.— Unit  from  which  plat 
built  up. 

CHAPTER  v.— Directions  of  Growth 56 

External  influences.— First  lines  of  growth  of  waterfront  city 
parallel  to  water  front;  of  inland  town,  along  intersecting 
turnpikes  and  of  railroad  town,  away  from  railroad  station 
along  principal  turnpike.— Contest  between  axial  and  central 
growth.— Normal  city  star-shaped.— Framework  of  cities  laid 
down  by  water  courses,  turnpikes  and  railroads.— Influence  of 
public  buildings  and  exchanges.— Continuity  the  vital  feature. 

vii 


CHAPTER  VI.— Distribution  of  Utilities .75 

As  city  evolves,   continual  specialization  in  business  and  dif- 
ferentiation in  social  grades.— Classification  of  utilities  and  lo- 
cations  sought.—  Distribution   of  business  utilities,  economic, 
of  residence  values,  social.— Movement  of  point  of  highest  value. 
— Direction  and  rate. 


CHAPTER  VH.— Currents  of  Travel 89 

Regularity  of  daily  travel  the  basis  of  its  effect  on  city  struc- 
ture.—Chief  daily  movements  between  residence  and  business. 
—Shopping  habits  of  various  classes— Retail  stores  chiefly 
located  by  currents  of  travel. — Change  of  axis  of  city  traffic. 
—Fluidity  of  daily  travel.— Street  railroads,  elevated,  under- 
ground, bridges,  ferries,  etc. 

CHAPTER  Vin.— Types  of  Buildings 97 

Suitability  to  location.— Proportion  of  cost  of  building  to 
value  of  land.— Effects  of  skyscrapers.— Table  of  business 
buildings  suitable  for  various  locations.— Table  of  residences 
suitable  for  various  locations. — Depreciation  and  life  of  build- 
ings.—General  effects  of  buildings. — Nuisances  and  restrictions, 

CHAPTER  IX.— Rentals  and  Capitalization  Rates 122 

Basis  of  gross  business  rents,  what  the  property  earns  for  the 
tenant;  of  gross  residence  rents,  what  the  tenant  can  afford 
to  pay.— Deductions  from  gross  rents  in  properties  of  different 
character,  and  table  of  percentages.— Effects  on  net  rents  of 
fluctuations  in  gross  rents.— Capitalization   rates. 

CHAPTER  X.— Scale  of  Average  Values 133 

starting  with  i.o  value  in  city  site,  aveiage  values  of  acreage 
on  outskirts,  mechanics'  residence  lots,  better  grades  of 
residence  lots  and  business  lots.— Tables  of  average  values 
for  best  business  and  best  residence  land  in  cities  of  different 
sizes  and  in  certain  selected  cities. 

CHAPTER  XI.— Summary 145 

Review  of  evolution  of  value  in  city  land,  economic  lent 
factors  of  attraction  and  repulsion.— Value  by  proximity  and 
by  accessibility.- Reactions  of  utilities.— Scope  of  individual 
Inquiry. — Problem  always  complex,  change  a  law  of  life.— 
While  conditions  change,  values  will  change.— The  study  of 
principles  should  reduce  errors  in  judgment  to  a  minimum. 


Vlll 


Principles  of   City  Land  Values. 

CHAPTER    I. 

Introductory. 

Economic  rent,  .the  basis  of  value.— Urban  economic  rent  the 
residuum  after  payment  of  all  charges  and  interest  on  build- 
ings^Intrinsj.c  vs.  exchange  value.— Utility  precedes  value 
in  city  land.lrGround  rents  based  on  social  service  of  loca- 
tions.-^rStructure  of  cities  controlled  by  definite  laws<r-Cities 
originate  at  point  of  contact  with  outer  world,  and*  grow  ih 
line  of  least  resistance  or  greatest  attraction  or  their  result- 
ant^Central  or  axial  Growth. -^Influence  of  buildings.— Final  , 
basis,  psychological.  >  U 

THE  basis  of  agricultural  land  values  has  been  established 
since  the  time  of  Ricardo,  and  throws  light  on  the  funda- 
mentals of  our  problem.  Value  in  urban  land,  as  in  agricultural 
land,  is  the  resultant  of  e^qnoimc^pr,  ground  ..xept  capitalized^ 
As  first  laid  down,  the  theory  of  agricultural  ground  rents  em- 
phasized fertility  as  a  source  of  rent.  Later,  when  it  was  noted 
that  it  was  not  the  most  fertile  lands  that  were  first  occupied 
but  rather  those  nearest  new  settlements,  accessibility  or  prox- 
imity to  cities  was  recognized  as  an  important  factor  in  creating 
agricultural  ground  rent.  In  cities,  economic  rent  is  based  On 
superiority  of  location  only,  the  sole  function  of  city  land  being 
to  furnish  area  on  which  to  erect  buildings. 

Urban  economic  rent  is  ascertained  by  deducting  from  the 
gross  rent  of  land  and  building,  first,  all  charges  for  services, 
such  as  heat,  light,  elevators,  janitors,  agents'  commission  for 
collecting  rents,  etc.;  second,  taxes,  insurance,  and  repairs,  and, 
finally,  interest  on  the  capital  invested  in  the  building.  Thig 
interest  on  the  cost  of  the  building  must  exceed  the  average  in- 
terest rate  by  an  amount  equal  to  the  annual  depreciation  of  the 
building,  thus  providing  a  sinking  fund  sufficient  to  replace  the 
building  at  the  end  of  its  life.  To  make  a  correct  showing  the 
building  must  be  suited  to  the  location  and  managed  with  or- 
dinary ability,  or  the  apparent  economic  rent  will  have  little  or 
no  bearing  on  the  value  of  the  land. 


2  PRINCIPLES    OF    CITY    LAND    VALUES. 

The  rate  of  capitalization,  turning  income  into  value,  is  based 
on  the  average  interest  rates  of  all  investments  and  fluctuates 
with  them,  although  within  closer  limits  and  more  slowly.  Wide 
differences  occur  in  the  rates  of  capitalization  of  rents  from  land 
of  different  uses  in  the  same  city,  and  smaller  differences  from 
land  having  the  same  use  in  different  cities.  Where  a  locality 
is  advancing  in  value,  capitalization  rates  are  low,  where  station- 
ary they  are  normal,  and  where  declining  they  run  very  high. 
After  the  vital  factor  of  prospective  increase  or  decrease  of  value, 
the  lesser  factors  -are  stability  of  rents,  ease  of  convertibility, — 
in  part  by  mortgaging  or  in  whole  by  selling, — and  character  of 
utilization,  as  involving  the  rates  of  depreciation  of  different 
classes  of  buildings.  In  general,  the  larger  the  city  and  the 
higher  the  class  of  property,  the  greater  the  stability  of  rents, 
and  ease  of  convertibility  and  the  lower  the  rate  of  capitaliza- 
tion. Differences  in  rent  are  plainly  apparent,  but  differences 
in  rates  of  capitalization  are  frequently  overlooked,  although  a 
very  large  proportion  of  value  in  urban  land  comes  from  a  low 
rate  of  capitalization.  To  illustrate,  of  two  pieces  of  land  yield- 
ing an  economic  rent  of  $10,000  annually,  one  well  located  and 
improved  with  ofllce  building  or  retail  shop  might  sell,  exclud- 
ing the  building,  on  a  4  per  cent,  basis,  or  for  $250,000;  while  the 
other,  covered  with  cheap  tenements,  might  sell,  excluding  the 
buildings,  on  a  10  per  cent,  basis,  or  for  $100,000.  The  rate  of 
capitalization  is  ascertained  by  figuring  backwards,  i.  e.,  divid- 
ing average  prices  paid  for  similar  land  by  the  net  income, 
which  shows  the  interest  rate  which  the  community  is  satisfied 
to  receive  on  such  investments. 

While  intrinsic  value  is  correctly  derived  by  capitalizing 
ground  rent,  exchange  value  may  differ  widely  from  it.  As  ordin- 
arily expressed,  "value"  means  exchange  value,  average  sales  be- 
ing considered  the  best  test  of  value,  and  since  all  ownership  lies 
subsequent  to  the  date  of  purchase,  the  estimated  futiu-e  pros- 
pects form  the  mastering  factor  of  all  exchange  values.  Al- 
though speculation  in  the  sense  of  assuming  large  risk  for  the 
chance  of  large  gain,  is  normally  confined  to  limited  sections  of 
cities  where  marked  changes  of  utility  are  taking  place,  specu- 
lation in  the  sense  of  an  attempt  to  make  money  from  an  in- 
crease in  the  value  of  property  apart  from  its  earnings,  is  a  fac- 
tor in  all  real  estate  transfers.  We  may  note  that  real  estate  spec- 
ulation is  always  for  the  rise,  speculation  for  the  fall  or  "short" 
sales  being  impossible,  owing  to  the  non-representative  quality 
of  land. 

Even  where  properties  are  fully  improved  for  their  present 
use,  if  a  new  utility  arises  or  is  anticipated,  since  this  may  m- 


EVOLUTION   OP   A   CITY. 
Paris  in  56  B.  C.  (Lutece)  Site  ,  )n  Island  chosen  for  defence. 


(Maps  printed  in  1705.) 


EVOLUTION   OP   A   CITY. 
Paris  in  508  A.  D.     First  walls  surrounded  buildings  on  island.         Second  walls  on  north  sid< 
First   beginnings    of   axial    growth    along    each   roa<?    issuing  from  the  walls. 


EVOLUTION   OP   A   CITY. 
Paris  under  Louis  the  VII.     Axial  growth  outside  the  walls    has  developed  into  centers  at  road 

intersections. 


EVOLUTION  OP  A  CITY. 

Paris  1180  to  1223.    New  walls,  Include  much  greater  area.     Central  growth  takes  place 

around  the  abbeys  and  churches  erected  mostly  on  ihe  sites  of  the  old  Roman  temples. 


EVOJL,UTION   OP  A  CITl. 

Paris  1367  to  1383.     Third  wall  on  north  side  includes  added    area.      City   shows   marked 
growth  on  north  side  within  the  walls  and  on  the  south  side,  outside  the  walls. 


EVOLUTION   OF  A  CITY. 
Paris  1422  to  1580.     The  Tullleries  cause  strong  axial  growth    out  the  Faubourg  St.  Honor 


EVOLUTION   OF   A   CITY. 
Paris  1589  to  1643.     The  hills  to  the  north  check  extension  in    ttat  direction. 


EVOLUTION  OP  A  CITY. 

Paris  In  1705.    The  city  has  spread  In  all  directions.  The  high    land  to  the  north  is  being  cut 

up  into  building  tracts. 


INTRODUCTORY.  11 

volve  a  different  basis  of  economic  rent,  capitalization  rate  and 
value,  by  such  estimated  difference  the  exchange  value  may  vary 
from  the  present  intrinsic  value.  If  the  new  utility  does  not 
arrive,  prices  may  advance  and  recede,  while  values  do  not 
change,  but  if  the  new  utility  arrives,  both  prices  auu  values 
will  alter  their  levels. 

To  be  reckoned  with  under  the  head  of  future  prospects  are 
not  only  local  changes  of  utility,  but  the  rate  of  growtn  of  the 
city  as  a  whole,  the  prosperity  or  depression  of  the  surrounding 
section  and  the  success  or  failure  of  the  industries  directly  sup- 
porting it.  Moreover,  general  financial  and  economic  condi- 
tions enter  so  largely  into  exchange  values,  that  values  are  at 
times  not  based  on  income,  or  supply  and  demand,  but  represent 
simply  a  condition  of  the  public  mind.^ 


First   houses   in   Grand   Rapids,   Mich.      Located   on   river  bank. 

The  dependence  of  value  in  land  on  economic  rent  is  clearly 
seen  in  the  origin  of  any  city,  utility  in  land  arising  when  the 
first  buildings  are  erected,  but  not  value  in  land,  as  is  evi- 
denced by  the  fact  that  the  first  settlers  are  commonly  allowed 
to  build  their  houses  wherever  they  please  and  enclose  whatever 
land  they  need,  as  occurred  in  New  York  and  many  other  cities. 
As  a  city  grows,  more  remote  and  hence  inferior  locations  must 
be  utilized  and  the  difference  in  desirability  between  the  two 
grades  produces  economic  rent  in  locations  of  the  first  grade,  but 
not  in  those  of  the  second.  As  land  of  a  still  more  remote  and 
inferior  grade  comes  into  use,  ground  rent  is  forced  still  higher 
in  land  of  the  first  grade,  arises  in  land  of  the  second  grade,  but 
not  in  the  third  grade,  and  so  on.  Any  utility  may  compete  for 
any  location  within  a  city  and  all  land  goes  to  the  highest  bid- 
der, but  owing  to  the  limited  suitability  of  certain  areas  for  cer- 


12  PRINCIPLES    OF    CITY    LAND    VALUES. 

tain  purposes,  some  land  has  but  one  utility.  Whatever  com- 
petition there  is  here,  will  be  among  those  of  the  same  class  of 
utilization.  Where,  owing  to  increase  or  decrease  of  various 
utilizations,  their  area  and  location  change,  competition  among 
different  classes  of  utilization  arises.  Practically  all  land  within 
a  city  earns  some  economic  rent,  though  it  may  be  small,  the 
final  contrast  being  with  the  city's  rentless  and  hence,  strictly 
speaking,  valueless  circumference.  The  prices  at  which  land  on 
the  outskirts  of  a  city  is  held  may  represent  either  the  cost  of 
platting  and  opening  streets,  or  more  frequently  the  discounting 
of  future  hopes,  the  chief  factor  lowering  values  being  the  ex- 
tent of  competing  land  due  to  the  fact  that  area  increases  as  the 
square  of  the  distance  from  any  given  point. 


Ft.  Wayne,  1794.     Site  chosen  at  intersection  of  small  rivers  (also 
of  Indian  trails). 

An  apparent  exception  to  the  law  of  no  value  in  the  site  when 
a  city  starts,  occurs  where  a  city  is  speculatively  undertaken  and 
the  lots  sell  at  high  prices  in  advance  of  utility.  The  difference 
between  price  and  value  is  usually  demonstrated  before  many 
years,  the  invariable  reaction  carrying  the  prices  of  lots  as  far 
below  their  value  as  they  were  formerly  above  it.  Thus  lots  in 
Columbus.  Ohio,  which  sold  in  1812  at  $200  to  $300.  sold  in  1820 
at  $7  to  $20,  and  more  recently  there  are  the  collapses  in  the 
early  history  of  the  speculatively  started  towns  of  West  Super- 
ior, Wis.,  Tacoma,  Wash.,  Wichita.,  Kan.,  and  Sioux  City, 
la.  The  attempt  to  force  economic  rent  into  city  land  seems 
to  be  uniformly  unsuccessful,  history  showing  that  cities  grow 
and  are  not  made,  and  that  human  beings  cannot  be  uprooted 


INTRODUCTORY. 


13: 


and  moved  in  large  numbers  and  immediately  adjust  themselves 
to  the  different  opportunities  of  a  new  environment. 

Why  are  ground  rents  paid  for  some  locations  and  not  for 
others?  In  general  terms  the  difference  in  desirability  is  based 
on  the  social  service  which  they  render,  or  conversely,  the  sac- 
rifice which  they  save.  The  land  which  is  most  convenient  is 
first  utilized,  and  that  which  is  less  convenient  is  made  of 
service  in  accordance  with  its  diminishing  facilities.  Since  con- 
venience means  economy  in  time  and  effort,  the  value  in  any 
piece  of  land  will  represent  the  cost  saved  or  the  pleasure  ob- 
tained by  its  use,  as  compared  with  the  use  of  land  worth  noth- 
ing, multiplied  by  the  number  and  economic  quality  of  the  peo- 
ple for  whom  the  saving  is  made.    Thus  the  value  of  all  urban 


Eay  City,   Mich,   1837.     Point  of  origin  at  first  dock. 

land  ranges  from  that  which  least  serves  the  smallest  number 
of  people  of  the  lowest  economic  quality,  up  to  that  which  best 
serves  the  largest  number  of  people  of  the  highest  economic 
quality. 

Since  value  depends  on  economic  rent,  and  rent  on  location, 
and  location  on  convenience,  and  convenience  on  nearness,  we 
may  eliminate  the  intermediate  steps  and  say  <  aat  value  depends 
on  nearness.  The  next  question  is,  nearness  to  what? — which 
brings  us  to  the  land  requirements  of  different  utilities,  their  dis- 
tribution over  the  city's  area  and  the  consequent  creation  and 
distribution  of  values. 

Our  problem  divides  itself  into  two  sides,  o^e  the  study  of  the 
structure  of  cities,  their  origin,  growth  and  movements,  the- 
other,  an  analysis  of  the  gross  rents    due  to    various    utilities,. 


14 


PRINCIPLES    OF    CITY    LAND    VALUES. 


their  economic  rents,  rates  of  capitalization  and  resulting  land 
values. 

Beginning  with  the  structure  of  cities,  if  cities  grew  at  ran- 
dom the  problem  of  the  creation,  distribution  and  shifting  of 
land  values  would  be  insoluble.  A  cursory  glance  reveals  simi- 
larities among  cities,  and  further  investigation  demonstrates 
that  their  structural  movements,  complex  and  apparently  irregu- 
lar as  they  are,  respond  to  definite  principles.  The  basis  of  this 
similarity  is  that  the  same  factors  create  all  modern  cities;  com- 
merce and  manufactures,  with  political  and  social  forces,  being 
everywhere  operative,  the  chief  difference  in  influence  coming 
from  variations  in  their  relative  power. 

Cities  originate  at  their  most  convenient  point  of  contact  with 


Marietta,  Ohio,  1788. 


Laid  out  as  military  post  with  water  pro- 
tection on  two  sides. 


the  outer  world  and  grow  in  the  lines  of  least  resistance  or  great- 
est attraction,  or  their  resultants.  The  point  of  contact  differs 
according  to  the  methods  of  transportation,  whether  by  water, 
by  turnpike  or  by  railroad.  The  forces  of  attraction  and  resist- 
ance include  topography,  the  underlying  material  on  which  city 
builders  work;  external  influences,  projected  into  the  city  by 
trade  routes;  internal  influences  derived  from  located  utilities, 
and  finally  the  reactions  and  readjustments  due  to  the  continual 
harmonizing  of  confiicting  elements.  The  infiuence  of  topog- 
raphy, all-powerful  when  cities  start,  is  constantly  modified  by 
human  labor,  hills  being  cut  down,  waterfronts  extended,  and 
Bwamps,  creeks  and  low-lands  filled  in,  this,  however,  not  tak- 
ing place  until  the  new  building  sites  are  worth  more  than  the 


INTRODUCTORY. 


15 


cost  of  filling  and  cutting.  The  measure  of  resistance  to  the 
city's  growth  is  here  changed  from  terms  of  land  elevation  or 
depression,  and  hence  income  cost,  to  terms  of  investment  or 
capital  cost.  The  most  direct  results  of  topography  come  from 
its  control  of  transportation,  the  water  fronts  locating  exchange 
points  for  water  commerce,  and  the  water  grade  normally  deter- 
mining the  location  of  the  railroads  entering  the  city.  As  cities 
grow,  external  influences  become  constantly  of  less  relative  im- 
portance, while  the  original  simple  utilities  develop  into  a  mul- 
titude of  differentiated  and  specialized  utilities,  tending  con- 
stantly to  segregate  into  definite  districts. 

Growth  in  cities  consists  of  movement  away  from  the  point  of 
origin  in  all  directions,  except  as  topographically  hindered,  this 


St.  Anthony,  1857,  now  East  Minneapolis,  on  east  side  of  river. 
Minneapolis  itself  originated  as  an  overflow  from  St.  Anthony,  the 
starting  point  being  determined  by  the  bridge  resting  on  the  islands 
shown. 


movement  being  due  both  to  aggregation  at  the  edges  and 
pressure  from  the  centre^.  Central  growth  takes  place  both  from 
the  heart  of  the  city  and  from  each  subcentre  of  attraction,  and 
axial  growth  pushes  into  the  outlying  territory  by  means  of  rail- 
roads, turnpikes  and  street  railroads.  All  cities  are  built  up 
from  these  two  influences,  which  vary  in  quantity,  intensity  and 
quality,  the  resulting  districts  overlapping,  interpenetrating,  > 
neutralizing  and  harmonizing  as  the  pressure  of  the  city's 
growth  bring  them  in  contact  with  each  other.  The  fact  of  vital 
interest  is  that,  despite  confusion  from  the  intermingling  of 
utilities,  the  order  of  dependence  of  each  definite  district  on  the 
other  is  always  the  same.  Residences  are  earlv  driven  to  tl^f  ^ 
circumference,  while  business  remains  at  the  centre,  and  as  resi- 


16  PRINCIPLES    OF    CITY    LAND    VALUES. 

dences  divide  into  various  social  grades,  retail  shops  of  corre- 
sponding grades  follow  them,  and  wholesale  shops  in  turn  fol- 
low the  retailers,  while  institutions  and  various  mixed  utilities 
irregularly  fill  in  the  intermediate  zone,  and  the  banking  and 
office  section  remains  at  the  main  business  centre.  Compli- 
cating this  broad  outward  movement  of  zones,  axes  of  traffic 
project  shops  through  residence  areas,  create  business  subcen- 
tres,  where  they  intersect,  and  change  circular  cities  into  star- 
shaped  cities.  Central  growth,  due  to  proximity,  and  axial 
growth,  due  to  accessibility,  are  summed  up  in  the  static  power 
of  established  sections  and  the  dynamic  power  of  their  chief 
lines  of  intercommunication. 

Turning  to  the  various  types  of  buildings  occupied,  we  note 
that  buildings  are  frequently  spoken  of  when  it  is  the  utility 


Los  Angeles  in  1857.    A  Mexican  city  which  has  disappeared  under 
American   rebuilding. 

carried  on  within  them  which  is  meant.  That  it  is  utilities  and 
not  mere  buildings  which  are  Influential  should  be  strongly  em- 
phasized, since  the  view  is  commonly  held  that  buildings  create 
value  in  land,  so  that  where  expensive  buildings  are  erected  the 
land  will  be  expensive,  and  where  cheap  buildings  are  erected 
the  land  will  be  cheap.  It  is  easy  to  disprove  such  a  superficial 
view  by  noting  misplaced  buildings,  such  as  a  business  building 
in  a  residence  section,  a  residence  in  a  business  section,  or  an  ex- 
pensive residence  or  business  building  in  the  midst  of  cheap  ones, 
which,  even  though  occupied,  probably  do  not  yield  enough  to  pay 
taxes.  Also  the  buildings  of  an  entire  section  may  by  no  means 
evidence  the  value  of  the  land,  as  note  the  handsome  residences 
on  the  upper  west  side  of  New  York  on  cheap  land  by  contrast 
with  the  old  brownstone  residences  on  the  costly  land  near  Fifth 


INTRODUCTORY. 


17 


Avenue;  or  witness  any  declining  business  section  from  which 
the  tenants  are  removing,  so  that  values  are  falling,  although 
good  buildings  remain.  Nevertheless,  it  is  true  that  the  quick- 
est method  of  arriving  at  an  approximate  estimate  of  the  value 
of  land  is  by  looking  at  the  buildings  by  which  it  is  covered,  for 
in  general,  buildings  are  properly  located.  To  say,  however, 
that  buildings  create  land  values  is  to  reverse  the  truth,  build- 
ings being  the  servants  of  the  land  and  of  value  only  as  they 
fulfil  its  needs. 


Chattanooga,  1863.  Population  chiefly  soldiers.  Market  Street 
from  5th  to  8th  Streets,  shown  in  center  of  picture  (even  then  the 
principal  street). 


The  continual  readjustments  in  the  life  of  a  city  reflecting  the 
total  social  relations  of  its  inhabitants,  lead  to  the  concept  of  a 
city  as  a  living  organism.  That  such  a  concept  is  popularly  held 
is  shown  by  the  common  phrases,  the  "heart"  of  the  city,  to 
represent  the  business  centre,  the  "arteries"  of  traflBc  to  repre- 
sent the  streets,  the  'lungs"  of  the  city  to  represent  the  parks, 
and  to  carry  the  simile  further  the  railroad  depots  and  wharves 
may  be  called  the  mouths  through  which  the  city  is  fed,  the 
telephone  and  telegraph  lines  its  nervous  system,  while  man  in 


18  PRINCIPLES    OF    CITY    LAND    VALUES. 

his  residence  has  been  likened  by  Spencer  to  a  particle  of 
protoplasm  surrounding  itself  with  a  cell. 

One  fruitful  source  of  error  in  studying  land  values  is  to 
regard  the  problem  as  involving  only  a  point  of  time  instead  of 
a  period  of  time.  Any  valuation  based  on  present  facts  alone  is 
incomplete,  consideration  of  past  influences  and  future  pros- 
pects being  vitally  necessary.  The  life  of  value  in  land,  whether 
the  unit  taken  is  a  city,  a  section  of  a  city,  or  a  single  lot,  bears 
a  close  analogy  to  all  other  life  in  being  normally  characterized 
by  a  small  beginning,  gradual  growth  and  increased  strength,  up 
to  a  point  of  maximum  power,  after  the  attainment  of  which 
comes  a  longer  or  shorter  decline  to  a  final  disappearance.  Thus 
all  value  in  city  land  undergoes  a  continuous  evolution  from  a 
state  of  non-existence  through  a  cycle  of  changes,  to  a  final  dis- 
solution, or  to  a  new  birth,  when  the  process  is  repeated  on  the 
same  land.  One  more  qualification  should  be  made  limiting  the 
working  of  economic  laws,  viz.,  the  individual  factor,  which  may 
create  or  destroy  cities,  sections  within  cities,  or  individual  prop- 
erties within  sections.  A  striking  uniformity  exists,  however, 
in  the  obedience  of  individuals  to  economic  laws,  self-interest 
being  a  compelling  factor,  so  that  individual  sections,  especially 
on  the  negative  or  destructive  side,  may  be  classed  as  excep- 
tions. 

Underneath  all  economic  laws,  the  final  basis  of  human  action 
is  psychological,  so  that  the  last  stage  of  analysis  of  the  prob- 
lems of  the  structure  of  cities,  the  distribution  of  utilities,  the 
earnings  of  the  buildings  which  house  them,  and  the  land  values 
resulting  therefrom,  turn  on  individual  and  collective  taste  and 
preference,  as  shown  in  social  habits  and  customs. 


CHAPTER   II. 

Forces  Crcatingf  Cities.' 

Defence  against  enemies.— Commerce— Manufactures.— Political 
forces.— Social  forces,  i.e.,  culture,  education,  art,  fashion, 
amusements.— All  forces  intermingled  in  the  larger  cities. — 
Final  basis,  energy,  enterprise  and  intellect  of  people. 

Defence  against  enemies,  the  chief  factor  in  primitive  times 
creating  cities,  survived  as  an  influence  affecting  the  first  settle- 
ments in  this  country,  the  early  forts  on  the  Atlantic  Coast  and 
in  the  West  drawing  population  around  them  in  the  same  way 
that  the  Roman  camps  on  the  borders  of  the  Danube  and  Rhine, 
and  the  Cossack  camps  in  southern  Russia  started  cities.  With 
the  establishment  of  civilized  government  the  necessity  for  de- 
fence has  vanished  and  population  is  concentrated  either  by 
commerce  or  manufactures,  or  by  the  less  important  political 
and  social  factors. 

Commerce,  or  the  distribution  of  commodities,  involves  their 
storage  and  transfer,  and  requires  warehouses,  docks  and  freight 
depots,  while  the  population  engaged  in  this  business  requires 
residences,  shops  and  public  buildings.  Where  the  products 
handled  are  of  low  value,  and  the  handling  is  a  simple  trans- 
shipment, the  result  of  even  a  large  flow  of  commodities  in 
locating  population  at  a  point  of  trans-shipment  may  be  small. 
It  is  when  the  transfer  of  goods  is  accompanied  by  a  breaking 
of  bulk  or  by  a  change  of  ownership,  there  being  then  added  the 
complex  mechanism  of  commercial  exchange  performed  by  im- 
porters, exporters,  wholesalers,  retailers,  insurers,  brokers  and 
bankers,  that  wealth  is  accumulated  and  localized,  with  conse- 
quent power  to  control  business  for  local  beneflt. 

Manufactures  are  of  constantly  increasing  importance  in  city 
growth,  owing  to  the  development  of  the  factory  system  and 
the  advantages  of  labor  supply,  transportation,  and  markets  in 
the  larger  cities.  Diversifled  manufactures  are  a  creation  of 
the  last  fifty  years,  the  law  of  development  being  an  evolution 
from  a  rough  working  of  coarser  forms  of  necessary  articles  in 
the  newer  sections  of  a  country,  through  various  grades  of  refin- 
ing and  specialization,  to  a  great  variety  of  necessaries  and 
luxuries  in  the  older  and  more  populous  sections.    A  city  created 


20  PRINCIPLES    OF    CITY    LAND    VALUES. 

solely  by  manufactures  is  a  modern  development,  among  such 
being  Essen,  Germany,  Pullman,  111.,  and  South  Bend,  Ind. 

Political  forces  operate  to  build  up  a  city  when  it  is  the  seat 
of  national,  state  or  county  government,  either  legislative,  exec- 
utive or  judicial,  or  all  combined.  The  administration  of  govern- 
ment as  a  single  factor  has  created  but  few  cities,  Alexandria 
furnishing  an  ancient  example,  St.  Petersburg,  Moscow  and 
Washington  later  examples,  and  in  this  country  a  few  state  capi- 
tals being  arbitrarily  started,  such  as  Columbus,  O..  Indianapolis, 
Ind.,  and  Lincoln,  Neb.  Nevertheless  the  rapid  growth  of  Berlin, 
London  and  Vienna  has  been  largely  due  to  the  centralizing  of 
national  government  in  those  cities.     In  many  American  state 


Boston  Back  Bay  about  1845.     Since  filled  in  and  made  the  most 
fashionable  residence  section  of  the  city. 

capitals,  city  growth  is  injured  by  public  attention  being  diverted 
from  business  to  politics. 

All  other  factors  creating  cities  may  be  broadly  classed  as 
social,  cities  being  centres  of  culture  and  furnishing  education, 
art,  fashion,  intellectual  stimulus  and  amusements  to  their  trib- 
utary country.  The  social  factor  operates  in  direct  ratio  to  the 
size  of  the  city,  social  ambition  and  opportunities  constituting  a 
steady  attracting  force  through  the  various  grades  of  cities, 
migration  being  from  the  farm  to  the  village,  from  the  village 
to  the  town  and  from  the  town  to  the  city.  Thus  the  fact  that 
New  York  counts  among  its  inhabitants  the  great  majority  of 
American  millionaires  is  of  vital  importance  in  maintaining  its 
luxurious  standard  of  hotels,  shops,  theatres,  clubs  and  restau- 
rants, which  in  turn  attract  the  pleasure-seeking  travel  of  this 
country.  In  so  far  as  a  city  is  a  market  or  consuming  centre, 
business  is  created  and  population  attracted,  cities  in  some  cases 
being  consuming  points  only,  such  as  Atlantic  City,  St.  Angus- 


FORCES   CREATING   CITIES.  21 

tine,  Newport,  etc.,  where  wealth  is  not  created,  but  a  city  is 
required  to  minister  to  those  distributing  wealth. 

All  cities  which  have  attained  any  considerable  size  include  in 
varying  proportions  all  the  above  factors  of  commerce,  manu- 
factures, political  and  social  forces.  In  each  city  the  sections 
built  up  by  the  different  factors  may  be  clearly  distinguished, 
these  flourishing  or  decaying  according  to  the  prosperity  or  de- 
cline of  their  special  factors.  Thus  the  railroads,  docks  ana 
warehouses  evidence  the  city's  commerce;  the  factories  its  in- 
dustrial energies;  the  retail  shops  the  consuming  power  of  the 
population;  the  residence  sections  the  wealth,  social  grades  and 
numbers  of  the  citizens;  and  the  buildings  of  public  and  semi- 
public  utility  the  standard  of  civilization  and  civic  pride  of  the 
city. 

The  underlying  factors  which  start  all  the  processes  creating 
and  distributing  wealth,  are  the  energy  and  enterprise  of  the 
people,  these  being  in  the  last  analysis  the  sole  sources  of 
wealth.  Raw  materials,  waterways,  favorable  climate  and  other 
natural  advantages  are  only  indirectly  decisive  and  always  pre- 
suppose men  to  exploit  them. 


CHAPTER  IIL 

Location   of  Cities* 

situations  for  defence  originally  most  Important.— Later  trade 
routes  located  by  topography  create  commercial  cities,  where 
break  in  transportation  occurs.— In  manufacturing,  extractive 
Industries  follow  raw  materials,  and  cheap  power,  and  later 
seek  the  largest  cities  for  labor  supply,  home  markets  and 
cheap  transportation.— Political  locations  compromises.- ESt- 
act  starting  points  analyzed.— Topographical  influences  most 
compelling. 

Situations  favorable  for  defence  determined  the  location  of 
ancient  cities,  as  with  the  Greek  colonies  on  a  promontory  or 
an  island,  the  Etruscan  cities  on  hill  tops,  Athens  with  the 
Acropolis,  Rome  on  seven  hills,  Paris  on  an  island  and  Lon- 
don in  the  midst  of  swamps.  In  modern  times  the  individual 
settler  locates  his  cottage  to  satisfy  his  first  needs  for  water, 
wood,  grass,  shelter,  etc.,  and  small  settlements  are  widely  scat- 
tered in  all  available  spots.  It  is  largely  geographical  superi- 
ority which  renders  certain  localities  capable  of  satisfying  more 
extensive  demands  and  lifts  small  settlements  into  cities. 

Trade  routes,  the  lines  of  least  resistance  between  the  sources 
of  products  and  their  final  markets,  have  in  all  ages  located 
commercial  cities  at  the  points  where  a  break  in  transportation 
occurs.  Where  a  traae  route  traverses  an  ocean  or  lake,  cities 
arise  at  the  harbors  which  have  easy  topographical  approach 
from  productive  regions  and  from  which  markets  can  be  readily 
reached.  For  example,  the  phenomenal  growth  of  New  York 
is  due  to  there  being  but  one  topograhically  easy  route  from  the 
West  through  the  Appalachian  Range  to  the  Atlantic  Coast,  con- 
centrating the  flow  of  products  to  New  York,  aided  first  by  the 
Erie  Canal  and  later  by  the  New  York  Central  and  other  rail- 
roads. Where  a  gulf  exists,  the  trading  city  is  commonly  located 
at  the  innermost  angle,  as  with  Christiania,  Liverpool,  Genoa, 
Naples,  Venice  and  Hamburg.  Where  the  action  of  the  sea 
closes  harbors,  ancient  cities  were  ruined,  as  with  Ephesus, 
Utica,  and  the  coast  cities  of  Asia  Minor  and  northern  Africa, 
while  modern  cities  retain  their  harbors  by  constant  dredging. 

Where  the  trade  route  follows  a  river,  cities  arise  either  near 
the  mouth  where  ocean  and  river  navigation  meet,  as  at  New 
Orleans  or  Philadelphia,  at  the  head  of  rivers  where  river  and 
crtek  navigation  meet,  as  at  Albany,  Richmond  and  St.  Paul,  at 


LOCATION   OF    CITIES. 


23 


the  confluence  of  two  or  more  rivers  or  branches  of  the  same 
river,  as  at  St.  Louis,  Omaha,  Mayence,  Coblentz,  and  Cairo,  at 
the  intersection  of  a  river  and  a  canal,  as  at  Richmond,  Syra- 
cuse, Evansville,  and  Fort  Wayne,  at  an  obstruction  in  the  river 
requiring  unloading,  as  formerly  at  Louisville,  or  at  a  marked 
bend  changing  the  direction  of  a  river,  as  at  Cincinnati,  Kansas 
City,  Madgebm-g,  Toulouse,  and  Lyons. 
A  river  in  forming  a  natural  highway  forms  also  a  natural 


'^^^^'^I'T'^^^TTTTT?;^'^' 


Constantine,  North  Africa.  Typical  site  of  ancient  Mediterranean 
city  on  flat-topped  hill,  chosen  for  defence. 


barrier  to  intercourse  between  its  two  sides,  so  that  facilities  for 
crossing  the  river  may  so  concentrate  travel  as  to  create  a  small 
trade  route  and  thus  a  town  at  the  river  crossing.  For  example, 
Harrisburg  started  at  a  ferry  across  the  Susquehanna  River; 
Rockford  and  Reading  at  fords  in  the  Rock  and  Schuylkill 
Rivers,  and  Terre  Haute  at  the  bridge  of  the  National  Pike 
across  the  Wabash  River.  Deep  water  in  rivers  will  locate  cities, 
as  with  Memphis,  Vicksburg,  Natchez,  Bremen,  Rotterdam, 
Antwerp,  and  Havre.    New  Orleans  owes  its  location  to  the  fact 


24 


PRINCIPLES    OF    CITY    LAND    VALUES. 


that  the  land  on  which  it  was  built  was  a  few  feet  higher  than 
any  river  land  within  many  miles  of  it. 

Land  trade  routes,  prior  to  the  time  of  railroads,  created  cities 
at  their  intersections,  commonly  in  the  centre  of  great  plains,  as 
with  Paris,  Vienna,  Moscow,  Berlin,  and  Prague.  Other  points 
were  where  plain  and  mountain  met,  requiring  a  change  in  trans- 
portation, as  with  Turin,  Milan,  Augsburg,  and  Munich.  The 
old  trails  from  the  Missouri  River  to  the  West  caused  the  begin- 


"--iKr^\  -"'■m 


•a 


j>^.K, 


W-' 


'•i 


Boston,  1777,  showing  how  nearly  the  site  was  an  island;  site  chosen 
chiefly  for  protection  against  Indians  and  wolves. 


ning  of  a  number  of  towns  as  oufltting  points,  such  as  Council 
Bluffs,  St  Joseph,  and  Topeka. 

When  railroads  were  invented,  they  superseded  all  other  land 
trade  routes,  and  owing  to  the  greater  economy,  both  in  the  con- 
struction and  operation  of  railroads  which  follow  a  water  grade, 
their  influence  has  in  most  cases  strengthened  existing  cities 
located  by  water  routes.  The  exceptions  to  this  occur  where  rail- 
roads run  contrary  to  the  general  topography  of  the  country,  as 
in  the  Mississippi  Valley,  the  trade  routes  now  running  east  and 
west  and  not,  as  originally  anticipated,  north  and  south;  where 


LOCATION   OF    CITIES. 


25 


mountain  barriers  are  overcome  by  means  of  tunnels,  such,  as 
those  under  the  Alps  and  the  Cascades,  and  where  railroads  in 
process  of  building  have  made  temporary  terminal  points,  wMch 
started  cities,  as  with  Worcester  and  Atlanta. 

In  manufacturing,  the  extractive  industries  locate  near  raw 
materials,  lumber  mills  being  built  near  forests,  as  in  Saginaw, 
Bay  City,  Minneapolis,  and  Seattle;  iron  foundries  near  iron  or 
coal  mines,  as  in  Pittsburg;  smelters  near  gold  and  silver  mines. 


mre/t. 


Savannah,  1818.     Showing  line  of  fortifications,  also  rice  swamps 
on  either  side,  which  have  restrained  growth  of  city  to  one  direction. 


as  in  Denver  and  San  Francisco;  salt  works  near  salt  wells,  as  in 
Syracuse,  and  formerly  in  Lincoln;  oil  refineries  near  oil  wells, 
as  in  Cleveland;  salmon  canneries  near  the  waters  where  salmon 
run,  as  in  Portland  and  Seattle;  fruit  canneries  near  orchards,  as 
in  Los  Angeles  and  San  Jose;  beet  sugar  factories  in  or  near  beet 
sugar  fields,  as  in  Saginaw  and  Bay  City.  The  extractive  industries 
migrate  as  raw  materials  are  exhausted.  Thus  the  lumber  indus- 
try has  moved  from  Maine  to  Michigan,  Wisconsin,  Minnesota, 
and  finally  the  Pacific  Coast,  and  the  meat-packing  industry 
from  New  York  to  Buffalo,  Indianapolis,  Chicago,  and  finally 


26 


PRINCIPLES    OP    CITY    LAND    VALUES. 


3^^S>''^'' 


ABIT  -WAS 

Ajagca  aoth,  1749. 


4^— Ammafiilaal'E'BoaMt 
iJ.-  QoArA  House  and  Bazrackt. 
iS^TovdJtsr  Marline. 
!>.— Tarlsh  Ciiurctu 
Z^Frkat's  Houee. 


O.— Boyat  Qardaos. 
9^-lMUTulaal  OArtfcn. 


ICBHCHCHffl 


FH 


DETROIT  RIVER 


Detroit,    1749.    Showing   old   plat   and   first   houses   within    the 
fortifications. 


ALLEGH ENY 


PLAN       or 


FORT  PITT. 

A..  Wtrl  Jfufurm: 

J.    ttockMU  ntrt  ffM. 


SCAIC 
ioon  too     10 


tealt  SOC  n.ptrintK 


Starting  point  of  Pittsburg.    Fort  at  junction  of  rivers  for  military 
reasons. 


LOCATION   OF    CITIES. 


27 


Kansas  City,  Omaha,  and  St.  Joseph,  near  the  centre  of  the  corn 
belt. 

Water  power,  when  of  sufficient  volume  and  fall  and  located 
in  a  section  of  natural  resources,  has  created  many  cities,  such 
as  Pall  River,  Lowell,  Minneapolis,  Spokane,  and  Schaffhausen. 
Also  in  many  cities  water  power  greatly  stimulated  the  early 
growth,  although  steam  has  since  supplanted  it,  as  in  Provi- 
dence and  Philadelphia.  The  recent  development  of  electric 
transmission  of  water  power  for  long  distances  is  promoting  the 
growth  of  Buffalo,  Los  Angeles,  Salt  Lake  City,  Portland,  Ore., 
and  Seattle. 

As  industries  become  more  specialized  a  steady  supply  of 
highly  trained  labor  becomes  of  greater  importance,  tending  to 


First  map  of  Memphis,  showing  start  of  city  at  junction  of  Wolf 
River  and  Mississippi  River. 


draw  them  to  the  larger  cities,  but  opposed  to  this  is  the  greater 
danger  of  strikes  in  large  cities,  which  creates  a  slight  counter 
movement  towards  smaller  villages.  A  further  argument  for  the 
larger  cities  is  that  they  furnish  a  home  market  for  much  of  the 
product,  and  that  being  located  on  trade  routes  low  transporta- 
tion rates  are  given,  the  commercial  and  industrial  factors  thus 
reacting  on  each  other.  Climate  is  a  factor  to  be  reckoned  with 
in  the  textile  industries,  cotton  and  woolen  manufactures  being 
aided  by  a  moist  atmosphere.  The  general  tendency  of  manu- 
facturing seems  to  be,  first,  to  create  many  small  towns,  and 
later  to  promote  the  growth  of  the  larger  cities  already  started 
by  commerce. 

Where  politics  govern  in  selecting  a  city  site  the  location  is 
ordinarily  a  compromise.      Thus  Washington  was  located  half 


28 


PRINCIPLES    OF    CITY    LAND    VALUES. 


way  between  the  north  and  the  south,  before  the  west  was  de- 
veloped, and  Columbus  and  Indianapolis  were  located  at  the 
geographical  centres  of  their  respective  states.  The  influence 
of  climate  in  locating  cities  is  shown  in  such  summer  resorts  as 
Newport,  Bar  Harbor,  and  Lenox,  and  such  winter  resorts  as 
Los  Angeles,  St.  Augustine,  Atlantic  City,  and  Pasadena. 

The  exact  starting  point  of  cities  is  worth  noting,  since  all 
growth  consists  of  movement  away  from  it  To  say  that  a  city 
owes  its  location  to  a  harbor,  to  the  head  of  river  navigation  or 
to  a  fertile  inland  plain,  is  somewhat  indefinite,  since  a  large 


Baltimore  as  laid  out.    1730,  and  showing  present  boundaries. 


part  of  the  harbor  may  be  neglected  and  valueless,  and  the  head, 
of  river  navigation  and  the  inland  plain  may  furnish  many  other 
locations  apparently  equally  desirable  and  yet  not  utilized.  In 
the  early  days  when  protection  was  all-important,  the  fort  was 
the  point  of  origin,  but  with  commercial  cities  the  starting  point 
Is  the  most  convenient  point  of  contact  with  the  outer  world; 
this  being  a  wharf  where  deep  water  and  a  high  bank  meet,  if 
transportation  Is  by  water,  the  intersection  of  turnpikes 
topographically  located,  if  transportation  is  by  wagon,  and  a 
railroad  depot  placed  for  the  convenient  shipping  of  products,  if 


LOCATION   OF    CITIES. 


29 


transportation  is  by  rail.  With  river  cities  the  requirement  of 
deep  water  and  a  high  bank,  and  further,  the  avoidance  of  swift 
currents,  was  frequently  best  met  where  a  creek  ran  into  a  river, 
the  first  docks  of  New  York  being  on  the  creek  where  Broad 
St.  now  is;  of  Philadelphia,  where  Dock  Creek  joined  the  Dela- 
ware River;  of  Toledo,  where  Swan  Creek  joined  the  Maumee 
River;  of  Memphis,  where  Wolf  Creek  joined  the  Mississippi 
River,  and  of  Richmond,  where  Shockoe's  Creek  joined  the 
James  River.  Where  steep  hills  descend  close  to  the  water's 
edge  there  are  in  some  instances  two  starting  points  for  the 


Lucca,  Italy,  in  1870.     Example  of  European  city  surrounded  by 
fortifications,  tending  to  concentrated  land  utilization. 


town,  one  for  business  buildings  at  the  water's  edge  and  the 
other  for  residences  on  the  hill,  as  at  Richmond,  Knoxville,  and 
Kansas  City.  At  Omaha,  owing  to  variations  in  the  height  of 
water,  the  town  started  about  ten  blocks  back  from  the  water- 
front. 

Where  the  first  settlers,  having  in  mind  a  future  city,  lay  out  a 
plat  at  the  inception  of  the  city,  the  starting  point  of  the  city  may 
be  determined  arbitrarily,  the  central  point  being  a  public  square 
or  a  public  building.  Corporate  or  private  ownership  is  in  some 
cases  suflSciently  powerful  to  alter  the  location  of  a  city,  either 


30 


PRINCIPLES    OF    CITY    LAND    VALUES. 


by  forcing  it  away  from  the  original  point  of  the  older  settle- 
ment, as  at  West  Superior  and  Tacoma,  or  by  preventing  it  from 
occupying  its  normal  site,  as  at  Houston. 

Sometimes  the  first  location  of  a  city  is  so  unsatisfactory  that 
the  entire  settlement  is  moved,  as  with  Akron,  O.,  where  the  soil 
did  not  hold  the  water  from  the  power  canal  for  the  flour  mill. 
Hence  the  mill  was  moved  and  the  town  followed.  Also  Charles- 
ton, S.  C,  first  started  on  the  west  bank  of  the  Ashley  River,  and 
Mobile  moved  in  1710  from  27  Mile  Bluff.  Small  towns  have 
been  bodily  moved  either  to  avoid  municipal  debt  or  to  secure 


(D9AI&A    &ne     \SmSi\S. 


&•<«  I  MXinoo 


Osaka  and  Kobe,  Japan.    Example  of  city,  back  from  waterfront  with 
smaller  city  serving  as  a  port. 


better  locations.  Recently  in  the  Dakotas  several  towns  were 
moved  on  rollers  from  six  to  twelve  miles,  from  the  small  rivers 
on  which  they  were  first  built  to  the  new  extension  of  the  Chi- 
cago, Burlington  &  Quincy  R.  R.  In  most  cases  vested  in- 
terests, both  in  the  buildings  and  in  the  value  of  the  land,  are  too- 
powerful  to  permit  of  a  wholesale  moving,  the  efforts  of  inhabit- 
ants being  aimed  towards  counteracting  any  deficiencies  of  loca- 
tion by  increased  or  differently  directed  labor. 

While  we  may  properly  speak  of  cities  as  having  started  from 
one  centre,  the  largest  cities  have  swallowed  up  many  villages 


LOCATION   OF    CITIES. 


31 


and  towns,  both  their  own  offshoots  and  independent  settle- 
ments. Thus  New  York  absorbed  Greenwich,  Chelsea,  Bowery, 
Harlem,  Brooklyn,  Long  Island  City,  etc.;  Philadelphia  ab- 
sorbed Spring  Garden,  Northern  Liberties,  Kensington,  South- 
walk,  Moyamensing,  etc.,  and  Boston  absorbed  Roxbury,  Dor- 
chester, Charleston,  Brighton,  Bast  Boston,  South  Boston,  etc. 
The  impetus  of  the  chief  city  is  so  great  as  to  practically  ob- 
literate the  influence  of  the  smaller  towns. 

The  importance  of  studying  the  geographical  location  of  cities 
is  due  to  the  insight  thus  obtained  into  their  structure,  the  dis- 
tribution of  population  conforming  to  the  same  principles  within 


M  8b  r   e    o    t  1 


Ancient  Alexandria.  Rectangular  plat  laid  out  by  the  Royal  architect. 


a  city  as  without.  Topography  operates  in  a  similar  manner, 
whether  within  or  without  a  city,  in  causing  population  to  flow 
along  the  same  levels.  Water  surfaces,  whether  within  or 
without  a  city,  if  navigable,  facilitate  the  movement  of  popula- 
tion, and  if  non-navigable  prevent  it.  The  law  of  continuity  is 
the  same,  every  city  being  a  link  in  the  chain  stretching  from 
the  first  settlements  in  a  country  to  the  last,  and  every  growth 
within  a  city  a  part  of  the  chain  of  development  which  first 
reaches  the  city  from  the  outside  and  continues  its  life  within. 
Manufacturing  has  the  same  centralizing*  effect,  whether  on  a 
large  scale  it  creates  a  city  or  on  a  small  scale  it  builds  up  a  dis- 


32 


PRINCIPLES    OF    CITY    LAND    VALUES. 


trict  within  a  city.  The  small  streams  of  products  from  the 
farm,  the  forest  or  the  mine  flowing  together  on  the  way  to  their 
markets,  create  trade  routes,  and  similarly  the  inhabitants  of  a 
city,  controlled  by  economic  forces  and  flowing  together  on  their 
daily  way  to  their  places  of  business,  create  traffic  streets  or  city 
trade  routes.      Railroads  which  create  cities  at  their  terminals 


OTIS    fMORroT) 


Modern  Alexandria.    City  shifted  onto  the  former  Island  of  Pharos. 
Reversion  to  irregular  plattings. 


and,  in  lesser  degree,  at  their  transfer  points,  have  their  coun- 
terpart in  street  railroads  which  draw  utilities  and  values  to 
their  terminals,  and,  in  lesser  degree,  to  their  lines  and  street 
intersections.  Finally,  the  law  of  gravitation,  which  draws 
bodies  together  in  direct  proportion  to  their  mass  and  in  in- 
verse proportion  to  their  distance,  operates  similarly  in  drawing 
together  two  cities  or  in  drawing  together  two  sections  within 
the  same  city. 


CHAPTER  IV. 

Ground   Plan  of  Cities. 

First  influence  consists  of  topographical  faults,  i.e.,  water  sur- 
faces or  sharp  variations  from  levels. — Characteristics  of 
platted  cities,  straight  streets  at  right  angles,  permitting 
free  movement  throughout. — Characteristics  of  haphazard 
growth,  irregular  tangle  of  crooked  and  narrow  streets  pre- 
venting quick  access  to  business  center. — Some  early  plats 
attempt  to  forestall  later  needs  and  some  to  determine  cen- 
ter of  city.— Normal  sizes  of  streets,  alleys,  blocks  and  lots: 
percentage  of  public  and  private  land. — Unit  from  which  plat 
built  up. 

rhe  first  step  in  studying  the  ground  plan  of  cities  is  to  note 
the  topographical  faults  which  normally  control  the  shape  of 
cities,  by  interfering  with  their  free  growth  in  all  directions 
from  their  points  of  origin.  These  are  of  two  kinds;  water  sur- 
faces, such  as  harbors,  lakes,  rivers,  creeks  and  swamps,  or 
sharp  variations  from  the  normal  city  level,  such  as  steep  hills, 
deep  hollows  and  ravines. 

Water  surfaces  may  either  leave  islands  on  which  a  city  orig- 
inates, as  with  New  York  and  Galveston;  promontories  at  the 
mouths  of  rivers,  as  with  Boston  and  Portland,  Me.;  promon- 
tories between  two  rivers,  as  with  Philadelphia  and  Pittsburg, 
or  may  consist  of  lakes  scattered  through  the  city's  site,  as  with 
Minneapolis,  Seattle  and  Grand  Rapids;  of  rivers,  as  at  Fort 
Wayne  and  Dayton;  creeks,  as  at  New  Haven  and  Toledo;  or 
marshes,  as  at  New  Orleans  and  Savannah.  The  rivers  may 
have  either  a  straight  front,  as  at  Albany,  St.  Paul  and  Port- 
land, Ore.,  a  curved  front  leaving  a  convex  site,  as  at  Cincin- 
nati, Louisville  and  Memphis,  or  may  be  combined  with  small 
rivers  and  creeks  intersecting  the  city's  site  in  various  ways. 
The  deep  harbors,  lakes  and  rivers  cannot  be  filled  in,  so  that  as 
far  as  they  extend  they  furnish  an  outline  for  the  city.  Increas- 
ing demand  for  land,  however,  may  project  growth  across  the 
deep  water  surfaces  and  form  suburban  settlements  beyond 
them.  The  power  of  rivers  to  hold  growth  on  the  side  where 
the  city  originates  depends  on  their  width,  on  the  area  and  rela- 
tive advantages  of  the  sites  on  the  two  sides  of  the  river,  and  .on 
speculative  enterprise.  At  St.  Louis,  New  Orleans  and  Kansas 
City,  where  the  river  is  wide  and  the  land  across  the  river  not 
attractive,  the  river  forms  practically  an  absolute  bar  to  growth. 
At   Toledo,    Portland,     Ore.,     Cincinnati,     Pittsburg    and     Des 


34 


PRINCIPLES    OF    CITY    LAND    VALUES. 


FMRLmUNT 


A  MAP 


PHILADELPHIA 

A.D.  1682. 


vBt-ig* 


ifiBBBB 


DDDDD 
DDDD 


DBDDiraDDnnCDBDnosgDDDUlJ 


HBDDDDDDDDDD 


TDnDDDnnnnnmnnn 
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Philadelphia,  10582.     Old  plat  shows  central  square,  now  the  mu- 
nicipal center. 


Pt«n  o«  City,  thowlng  Bulldin 


New  Orleans,  about  1728.     Old  French  city;    canal   on   the  west 
later  became  Canal  St.,  and  American  city  built  west  of  it. 


GROUND    PLAN    OF    CITIES. 


85 


Moines,  many  bridges  connect  the  two  sides  and  minimize  the 
deterring  effect  of  the  river. 

Creeks  are  of  chief  importance  when  their  erosion  has  worn  a 
deep  and  wide  ravine,  the  difference  in  level  constituting  a  bar 
to  a  city's  growth  ratner  than  the  creek  itself.  When  the  creek 
is  narrow  it  is  frequently  covered  over  and  ceases  to  exert  any 
influence,  as  in  New  York,  Richmond,  and  other  cities. 

Swamps  limit  growth,  for  example  preventing  Philadelphia 
from  growing  south,  and  Savannah  from  growing  east  and 
west.    On  the  other  hand.  New  Orleans  is  largely   built   on    a 

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Example  of  platting  parallel  to  irregular  water  fronts.    Baltimore. 


swamp,  important  parts  of  Washington  and  Syracuse  were  for- 
merly swamps,  and  in  the  lower  part  of  New  York  the  Collect 
Pond,  Lispenard  Meadows,  Beekman  Swamp,  &c.,  have  been 
filled  in  and  obliterated. 

After  a  city  has  spread  over  the  original  levels  and  climbed 
some  moderate  elevations,  the  demand  for  land  may  cause  a  fill- 
ing in  of  the  lower  levels.  In  Boston  the  Back  Ba^  district  was 
created  by  filling;  in  Chicago,  after  the  great  fire  of  1871,  the 
city  was  raised  from  seven  to  ten  feet;  in  San  Francisco  from 
Montgomery  Street  east  was  formerly  mud  fiats;  and  the  pro- 


36 


PRINCIPLES    OF    CITY    LAND    VALUES. 


cess  of  filling  in  land  for  business  purposes  continually  goes  on 
in  the  majority  of  water  front  cities. 

The  influence  of  topography  may  be  summarized  by  saying 
that  level  land  attracts  business,  moderate  elevations  attract 
residences,  land  below  the  normal  level  attracts  transportation 
lines,  and  filled-in  land  is  generally  used  for  warehousing,  man- 
ufacuring  and  cheap  tenements. 

The  main  direction  of  city  growth  is  usually  controlled  by  to- 
pography. For  example,  the  cities  at  the  west  end  of  harbors  or 
on  the  west  side  of  rivers  grow  west,  as  Boston,  San  Francisco, 
St.  Louis,  Omaha,  Minneapolis;  cities  on  the  east  side  of  har- 


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Example   of  diagonal   avenues   superimposed   on   rectanglar  plat- 
ting.  Washington. 


bors  or  rivers  grow  east,  as  Columbus,  St.  Joseph,  Memphis, 
Grand  Rapids,  Seattle,  and  similarly  New  York,  Philadelphia. 
Detroit,  New  Orleans,  Milwaukee,  Indianapolis  grow  north;  and 
Louisville,  Kansas  City,  Savannah,  Houston  grow  south.  The 
impression  that  the  points  of  a  compass  affect  the  direction  of 
city  growth  Is  based  on  the  statement  that  the  majority  of  Eng- 
lish and  German  cities  are  growing  west,  owing  to  the  prevail- 
ing west  winds  which  drive  away  the  dense  smoke  from  soft 
coal  and  render  the  west  end  of  these  cities  the  preferable  resi- 
dence sections.  No  such  general  tendency,  however,  exists  in 
this  country. 
As  to  their  laying  out.  cities  may  be  divided  into  two  classes, 


GROUND    PLAN    OF    CITIES. 


87 


those  which  have  grown  up  without  any  definite  ground  plan 
and  those  whose  ground  plan  has  been  laid  out  in  advance  of 
growth.  The  cities  which  have  grown  up  haphazard  exhibit  a 
tangle  of  narrow  and  crooked  streets  of  varying  and  irregular 
size,  evolved  from  cow  paths  or  old  trails,  whose  directions  were 


Irregular    platting    in    old    sections.    Rectangular    platting    in    new 
sections,    especially   in   Back   Bay   District,   Boston. 


originally  influenced  by  trifling  obstacles,  such  as  hillocks, 
rocks  or  clumps  of  trees.  These  flrst  streets  left  large  tracts  be- 
tween them,  which  were  later  pierced  by  irregular  streets  or 
lanes  laid  out  for  the  convenience  of  the  owner  of  the  tract,  and 
without  consideration  for  the  general  interests  of  the  city. 

Where  a  plat  has  been    laid    out    in    advance,  long,  straight 
streets  of  even  width,  at  right  angles  to  each  other,  are  found. 


38  PRINCIPLES    OF    CITY    LAND    VALUES. 

leaving  rectangular  blocks  for  building  sites.  The  older  cities 
with  marked  modern  growth,  such  as  Rome  and  Athens,  New 
York,  Boston  and  Baltimore,  exhibit  almost  uniformly  an  old 


SAVANNAH     RIVER 


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— I  r-|| — II — II — II — II     II — 1 


Savannah 


Plat  of  Savannah  showing  unusual  percentage  of  park  and  street 
area.  Plan  said  to  have  been  derived  from  Bunyan's  description 
of  the  Heavenly  City. 


centre  of  crooked  streets,  surrounded  by  modern  rectangular 
plats,  this  change  proving  the  general  appreciation  of  the  ad- 
vantages of  the  rectangular  method.    Some  cities,  however,  have 


GROUND    PLAN    OF    CITIES. 


39 


never  changed  to  rectangular  platting,  among  them  being  At- 
lanta, Los  Angeles,  Salem  and  Lynn. 

A  number  of  the  older  cities  originated  with  a  small  rectan- 
gular plat,  surrounded  later  by  rectangular  additions,  as  Phila- 
delphia, New  Orleans,  Cleveland  and  Cincinnati,  while  the  new- 
est cities  have  generally  started  with  widespread  rectangular 


/  / 

1 — 1  y  y  1 — 1             / 

\ 

i 

i 

M 

i 

First  plat  of  Los  Angeles.    Lots  around  Plaza  (marked  P)  given  to 
settlers;  also  tracts  between  irrigating  ditch  and  river,  for  farming. 


platting,  as  Birmingham,  Sioux  City,  Tacoma  and  Topeka.  An 
exceptional  instance  would  be  Memphis,  starting  with  a  small 
rectangular  plat,  extended  later  by  irregular  streets,  a  rever- 
sion recalling  the  contrast  between  ancient  Alexandria  in  Egypt 
with  its  rectangular  plat,  and  modern  Alexandria  with  irregular 
laying  out. 


% 


40 


PRINCIPLES    OF     CITY     LAND    VALUES. 


In  waterfront  cities  with  rectangular  plats  the  waterfront  is 
normally  used  as  a  base,  whether  straight,  curving  or  broken 
and  irregular,  and  in  inland  cities  the  turnpikes  are  used  as  a 
base.  These  plats  extend  to  a  greater  or  less  distance  accord- 
ing to  the  expectations  of  the  early  inhabitants,  but  finally 
reach  land  held  according  to  the  section  lines  of  the  U.  S.  Grov- 
ernment  survey.  This  change  in  the  direction  of  holdings  com- 
monly changes  the  direction  of  the  new  additions  and  streets 
platted,  as  in  Denver,  Seattle  and  Montgomery. 

Another  variation  in  rectangular  plats  is  due  to  the  survival 
of  old  turnpikes  in  parts  of  the  city  subsequently  platted.  Many 
of  these  old  roads  are  obliterated  by  platting,  but  others  remain, 


QREAT    «*1.T  tAKt  CITT.       (Flt.ni  lllC  Xpnll. 


Salt  Lake  City,  about  1860.     Large  blocks  designed  for  a  farming 
community. 


f 


on  account  of  their  convenience  for  traffic,  the  important  build- 
ings upon  them  and  the  fact  that  land  titles  are  often  meas- 
ured from  them,  as  from  Broadway  in  New  York.  Of  surviving 
turnpikes,  the  most  common  are  those  which  exist  in  the  sub- 
urbs, but  have  been  merged  into  the  rectangular  streets  before 
reaching  the  heart  of  the  city,  as  in  Chicago,  Philadelphia  and 
Milwaukee.  Diagonal  turnpikes  reaching  to  the  heart  of  the 
city  still  remain  in  Cleveland  and  Detroit,  and  one  main  turn- 
pike remains  in  San  Francisco,  Macon  and  St.  Joseph. 

Historically  distinct  but  practically  similar  to  turnpikes  are 
the  diagonal  streets  laid  out  on  the  original  plat  of  some  cities, 
such  as  Washington,  Buffalo  and  Indianapolis.     Variations    in 


GROUND    PLAN    OF    CITIES. 


41 


plats  occur  where  a  Ci.y  is  tke  result  of  two  or  more  settlements 
which  have  grown  together  and  merged,  as  in  Toledo,  Mont- 
gomery, &c. 

The  general  effect  of  irregular  laying  out  is  to  strengthen 
central  growth  as  opposed  to  axial  growth,  quick  access  to  or 


Albany,    1G95.     Intersection   of  Handlers   and   Jonkers   Streets,   now 
Broadway  and  State  Street,  still  the  business  center  of  the  city. 


from  the  business  center  being  afforded  only  by  turnpikes.  A 
disadvantage  felt  later  is  that  as  a  city  expands  and  quick  com- 
munication over  great  distances  becomes  imperative,  vast  ex- 
pense is  incurred  in  widening  and  straightening  streets,  this 
expense  being  sheer  waste  due  to  lack  of  foresight,  Paris  un- 
der   Baron    Haussmann    spent    $250,000,000    on    a    system    of 


42 


PRINCIPLES    OF    CITY    LAND    VALUES. 


boulevards;  London's  new  Strand  improvements  are  to  cost 
$33,500,000  (of  which  $80,000,000  will  be  refunded  from  the  sale 
of  frontage)  and  some  older  American  cities,  notable  Boston, 
have  spent  large  sums  on  such  work. 


PLAN  or  the:  TOWN  (kFORT/nCA  T/ONSo.rDBTROIT 

JTs  I  net/  sloocl  be/ore  the  year   t7&C. 
IrtoBh  TtimiOts  Map  macfe  May  3o"W6,   m'fft  txddltions  Jrom  JfoleS 
""""^  t;-^«^bMine(i  jy-om  the  lYeir  D^fi€trltnene,sk0tring  it* 

f^^^n~~Y\'     -tt  rtleUion  to  Ike  fu-esent plan  </  /fie  Ce'fjf 
^ect/e  4^0/eei  ia///ie/$' 

WwiiiiH/iTA.  *"^' 


Detroit,   179G.      The   small   first   plat   near   the   river   and   parallel 
to  It  has  been  wiped  out  by  the  larger  modern  platting. 


The  effect  of  rectangular  platting  is  to  permit  free  movement 
throughout  the  city,  this  being  further  promoted  by  the  addition 
of  long  diagonal  streets.  The  need  for  diagonal  streets  depends 
largely  on  the  shape  of  the  city's  site,  there  being  but  little  use 


GROUND    PLAN    OF    CITIES. 


43 


for  them  in  such  narrow  cities  as  New  York  and  Boston,  while 
they  are  of  great  utility  in  any  city  which  spreads  in  all  direc- 
tions over  a  level  area,  such  as  Chicago,  Detroit  and  Buffalo, 
Washington  furnishes  an  extreme  example  of  diagonal  streets, 
the  large  proportion  of  land  taken  up  by  streets  and  squares 
being  suitable  to  a  political  city,  where  it  would  not  be  econom- 
ical for  a  business  city. 

While  early  platting  is  generally  made  to  conform  to  the 
needs  of  the  period,  in  some  cases  attempts  were  made  to  fore- 
see later  needs,  as  in  the  plat  of  New  York  laid  out  in  1807  from 
Houston,  Eighth  and  Thirteenth  Streets  to  the  Harlem  River. 


arlem,  1670.     An  unusual  plat  in  that  the  principal   street  ran  at  right  angles  to  the  river. 
Old  plat  wiped  out  by  the  New  York  plat  of  1807. 

Since  at  that  time  all  commerce  was  by  water,  it  was  reckoned 
that  the  chief  traffic  in  New  York  would  necessarily  be  between 
the  Hudson  and  the  East  Rivers,  for  which  reason  east  and  west 
streets  were  placed  200  feet  apart,  while  north  and  south  ave- 
nues were  placed  from  600  to  900  feet  apart,  there  being  thus 
fourteen  avenues  instead  of  fifty.  As  a  result  New  York  pre- 
sents in  the  main  the  unusual  condition  of  having  its  business 
streets  running  in  one  direction  and  its  residence  streets  at  right 
angles.  If  the  Commission  had  had  greater  knowledge  of  cities 
and  could  have  foreseen  the  vast  growth  of  New  York,  they 
would  have  realized  that  the  chief  internal  movement  would 


Constantinople.  Irregular  roads  both  in  city  and  in  outlying  dis- 
trict Illustrate  process  by  which  city  is  laid  out.  Buildings  are 
crowded  into  the  large  irregular  blocks,  and  small  alleys  (not  shown 
on  map)  furnish  accesB. 


GROUND    PLAN    OF    CITIES. 


45 


IDDD 
IDDD 

ytDnDDanoDLj 


LiLJUUUUUUUUUKfl^ 


DoaDnnn 
DDScnna 


ODD 

on 

uDOD 
nnnn|]nnn 


DDllCD 
QDDnODD 
LulDQQ 
OnDDDDDDDDDDDQO 


uuDDM 


DDDDDQa 
pa     DC 


i 


mr■o^nn\\ 


bhULMf 

BngB 

ODDDODDDBO 
DDDDD 


J   tlDDDOr    eBDDD^i 
DDUOnDDDLJUODBLln 


IDOC 


QD 


«i^nnnn^nnnnnnnannN'nnnnnnnrinnFinnnnGnsir7^e3inc 


A  Lost  Pike.    Old  Westport-Independence  road  recently  platted 
out,  with  growth  of  residence  section.     Kansas  City. 


Map   of  Chicago,   Showing  the   Surviving  Turnpikes. 


46 


PRINCIPLES    OF    CITY    LAND    VALUES. 


necessarily  be  on  the  line  of  the  longest  axis,  and  the  check  put 
upon  north  and  south  travel,  with  the  resulting  economic  loss, 
would  have  been  avoided. 

The  plats  of  some  cities  indicate  an  attempt  on  the  part  of  the 
early  platters  to  locate  in  advance  the  centre  of  the  city.   In  New 


^^\X 


Y 


DUCT 
DOC 

nor 

uUDDULI! 

,  „    [joancntjfiij: 

,^A^&/>^  jDDaQQDnaGnc 
--\  ^  ■      yO^PS^"^.  iDuGDnanaoDL 


\,sM§m. 


^<yMPM 


WMM 


wm 


z 


[IJOulJmiLILiLJu'JLlLnl^GnQnciDoccDCQaDGaaQODna 


^.^^-^^^^^^  IDOOnGGOOaDD^qDnODGGQui      ' 


jn'JnanfTuoQnDDDUDo 

nnnnnnnnnnnnnnnnrm 


U0l]UiJBOCQ[]GnriQUDODaDDDDDDDDD0GnnDCGana 

UDOODDDDDDDOGOnr^ninaLiQD 

noDDnonDDDDGQ        JHDGDn 

.!5,0naQ0IIlDDDC[iDDDCDGI]P      ^°°^°° 

OaC^GOGUGDDDDGDQGDOOODi: 

OGGnDnGOQiJuuanQcnGDnaoDDKDDC 

QDGDOlJIiGOGaTtCQGDDDnQDaDDDIlDGCGQ 

QDQijciJGDGanorffianQ-uGoi — dogcqgoqoqdge 
oniJDGDoinnGDLfBrr 


GGQQQDDDi. 
^nODGGDO 


rscac 


DQUGL 
I 

Original  plat  parallel  to  river.     Black  line  marks  change  of  plat- 
ting to  conform  to  U.  S.  section  lines.     Denver. 


England  and  frequently  in  the  south  a  public  square  was  com- 
monly laid  out  on  which,  or  facing  which,  the  State  and  County 
buildings  were  erected,  also  the  principal  churches  and  business 
buildings.  Such  a  square  by  serving  as  a  barrier  to  business 
growth,  tended  to  confine  the  business  part  of  the  city  to  that 


GROUND    PLAN    OF    CITIES. 


47 


side  of  the  square  on  which  it  started,  with  the  exception  of 
such  business  as  spread  along  the  turnpikes,  which  usually 
bounded  two  sides  of  the  square.  Another  method  was  to  lay- 
out two  wide  streets  at  right  angles  to  each  other,  and  strengthen 
this  by  locating  the  County  Court  House  at  their  intersection, 
as  in  Philadelphia,  with  the  Court  House  at  the  intersection  of 


Tokio,  Japan.     Example  of  star-shaped  city,  normal  type  of  growth. 


Broad  and  Market  Streets;  in  Reading  at  Penn  and  Fifth 
Streets;  in  Knoxville  at  Gay  and  Main  Streets;  in  Terre  Haute 
at  Third  and  Main  Streets;  in  Bay  City  at  Center  and  Madison 
Streets,  and  in  Canton  at  Tuscarora  and  Market  Streets,  It  is 
needless  to  say  that  such  attempts  were  futile,  the  business  cen- 
tres of  cities  depending  on  more  powerful  factors  than  platting 


48 


PRINCIPLES    OP    CITY    LAND    VALUES. 


FIRST  5-r 


V 


V/3 

1 

'k 

5  TEMPLE  3\ 


SALT  LAKE  CITY 
Fig.  1.   Simplest  form— block  divided 
into   Quarters. 


^ 

THIRD 

s-^ 

% 

2: 

so 

1 

1 

5) 

i 

0' 

SI 

zee 

NI 

)  5 

T 

PORTLAND  0« 

Fig.    2.    Quarters   of   block   divided 
In  half. 


:SECOND    A^ 


< 

t 


X 
u 


riRi>T  A>^ 


SEATTLE: 

Fig.  3.    Same  as  No.  2,  except 
for  alley. 


and  Court  Houses.  In  general, 
in  proportion  as  a  plat  is  laid 
out  to  further  the  natural  lines 
of  a  city's  growth,  it  defines  and 
establishes  values,  and  in  pro- 
portion to  its  variance  with  the 
city's  needs  it  tends  to  disperse 
land  values  and  render  them 
unstable. 

Turning  to  a  more  detailed 
consideration  of  plats,  varia- 
tions in  the  width  of  streets  and 
sizes  of  blocks  involves  the  pro- 
portion of  public  land  used  for 
communication,  and  of  private 
land  used  for  buildings.  In  rect- 
angular plats  streets  usually 
range  in  width  from  forty  to 
eighty  feet,  sixty  feet  being  a 
fair  average  in  the  newer  cities, 
though  every  city  shows  wide 
variations.  There  is  a  common 
impression  that  additional  width 
in  the  street  always  adds  to  its 
value,  since  the.  wider  the  street 
the  greater  the  volume  of  traffic 
which  can  be  accommodated.  In 
a  business  street  width  is  prac- 
tically disregarded,  but  few 
streets  in  the  world  having 
more  traffic  than  they  can  carry, 
additional  transportation  facili- 
ties below  ground  and  above  re- 
lieving the  pressure.  In  a  resi- 
dence section,  however,  a  wide 
street  is  always  desirable.  A 
somewhat  narrow  business  street 
has  a  slight  advantage  in  facili- 
tating intercourse  between  the 
sides  of  the  street,  especially  as 
lack  of  width  does  not  operate 
to  limit  the  height  of  buildings, 
although  prominent  locations  on 
open  squares  are  sought  for 
some  forms  of  business. 

Alleys    are    modern    develop- 


GROUND    PLAN    OF    CITIES. 


49 


LOCUST  5-' 

1327 


•J) 

^ 

^       \->1. 

.=z     - 

WALNUT  ^-^ 
PJE5   MOINES.    lA 

Fig.  4.    Same   as   No.   3,   except   for 
double  alley. 


5-^  CLAIR 

3-^ 

i2o 

d^ 

1 

V*' 

4o 

1 

4o 

SU>t>IlT    £>'^ 


TOLEDO 


Fig.  5.  Variation  on  No.  3.  The  more 
valuable  frontage  cut  into  smaller  lots. 
Corner  lots  face  on  Jefferson  St.  be- 
cause more  valuable  than  St.  Clair  St. 


THI-RD    ^■^"N" 


I- 

"/3 

^ 

yj 

(fl 

'< 

' 

z 

: 

^ 

££!. 

sz's 

ra'/j 

- 

X 

yoURTH  ^I'N 

MINNEAPOLIS 

Fig.  6.    Variation   on   No.   3.       Lots 
face  the  most  valuable  frontage. 


ments  not  found  in  older  cities 
and  usually  run  parallel  to  the 
principal  business  streets,  or  the 
streets  which  are  expected  to  be 
the  principal  business  streets 
when  the  city  was  laid  out. 
While  in  cities  of  moderate  size 
alleys  are  useful  in  furnishing 
access  to  the  rear  of  buildings, 
in  the  larger  cities,  where  land 
is  closely  utilized  by  means  of 
interior  courts  and  light  wells, 
they  are  a  detriment  in  interfer- 
ing with  such  economic  arrange- 
ments. 

Blocks  range  in  size  from  200 
feet  square  to  660  feet  square, 
any  depth  over  200  to  250  feet 
involving  a  waste  of  land  at  the 
interior  of  the  blocks  owing  to 
non-accessibility.  Salt  Lake  City 
with  blocks  660  feet  square  fur- 
nishes an  aggravated  case  of 
loss  of  value  in  land  by  bad 
platting.  The  attempts  which 
have  been  made  to  utilize  the 
interior  waste  land  by  cutting 
streets  through  the  large  blocks, 
exhibit  a  reversion  to  the  prim- 
itive methods  of  individual 
rather  than  municipal  laying 
out  of  streets,  these  being  nar- 
row, irregularly  laid  out  and 
lacking  the  vital  feature  of  con- 
tinuity through  the  various 
blocks,  thus  defeating  their 
avowed  object  of  attracting 
traffic  into  the  interior  of  the 
blocks.  The  shortsightedness  of 
these  owners  is  due  to  a  sup- 
position that  the  value  of  retail 
business  land  is  based  on  area 
instead  of  on  frontage  on  traffic 
streets. 


50 


PRINCIPLES    OF    CITY    LAND    VALUES. 


F1R5T  3"^ 


9*3 

198 

0. 

1 
99 

99 

g 

199 

■09 

99 

0^ 

? 

99 

2 

8i 

199 

SECOND      ^"^ 


Fig. 


DAYTON  .  O. 

Lots  face' Main  St.,   the  most  valuable  frontage,   an  exception  to 
the  generafl'plat. 


PRAIRIE  A^ 


5    '- 

«. 

,00   ^ 

.? 

-<0o 

■SST 

""^ 

' 

r 

• 

' 

' 

£^ 

- 

' 

. 

' 

««. 

1,-      ^ 

.s 

,.    ^ 

TEXAS  A^= 


HOUSTON .  TEXAS 


Fig.  8.    Lots   face   all   four   streets   in   proportion   to 
value.    Land  closely  platted. 


i  (iWASHlNGTON  fiC^*^  3 


^<^ 

.. 

^6 

i 

u 

k* 

1 

66 

1 
^6 

THIRD   S-^  S 

MINNEAPOLIS 

Fig.  0.   Similar  to  No.  8,  but  a 
larger    block. 


FIFTEENTK   S"^ 


S  '"  ■ 

3S 

T 

23 

-*  s 

ai 

£. 

L 

LL 

i! 

N       loo 

FOURTEENTH  S't 


NEW  YORK 
Fig.   10.     Typical  long  New  Yorlc  block;  end  lots  facing  on  avenues. 


GROUND    PLAN    OF    CITIES. 
TIRST     SOUTM    S-r 


51 


t6^ 

114 

51 

0 

n 

n 

H 

VJ 

h4 

< 

o 

0 
KV 

X 

3 

145- 

96« 

65-  i6s- 


^             ,6^ 

5 

1&5 

SECOND  SOUTH  6^ 


^ALT  JLAKE  CITY 
Fig.   11.     Irregular  cutting  through  very  large  block. 


SECOND  3-^ 


V) 

CO 

T 

T-*)*  -^' 

'A 
0 

= 

^ 

w 

•• 

7^A 

^ 

w 

-■ 

•-3 

7V/,1 

MAIN      51 
1^ 


COUPJT 
.6«  VJAT^E 


151^ 


W 


6^ 


n?I 


It 

A 

S) 

,65^ 

51 

D 
0 

74-^ 

f.y. 

n;^ 

.. 

.. 

m. 

U 

^ 

•. 

- 

3T-)( 

T.y. 

T.y. 

0 


»?T^>* 

si 

.- 

' 

^ 

V}  ^ 


ftjM 


ji^ 


n^ 

3V^ 

THf 


^r 


T^ 


MEMPHI5  TENK 

Fig.  12.     Lots  platted  to  face  square,  originally  designed  to  be  city 


center. 


52 


PRINCIPLES    OP    CITY    LAND    VALUES. 


The  proportion  of  city  area  used  for  streets  and  alleys  ranges 
from  about  35  per  cent,  in  Vienna  and  New  York  to  55  per  cent 
in  Washington.  The  first  theoretical  aspect  of  the  division  of  a 
city's  area  into  public  and  private  land,  is  that  the  more  land 
given  up  to  streets  the  greater  the  dispersion  of  business  and 

OHIO    S^ 

^s  IS 


4'^' 

T</. 

0 

V* 

\               \           ^ 
\             \         S 

: 

r 

""\/^^ 

sr/y 

1 

/ 

0 

H 

T-A 

/ 

/ 

MARKET  5-^ 


MONUMEKT  T^ 


MARKET  S^ 


o 


' 

« 

/       /     » 

5 

SX'A 


c^ 


^" 


0 

4o      6e 


T'^ 


XA 


< 
p 
2 


T.;^ 

0 

6o     (S* 


< 


WA5HlN<^T01Nr  S-x 


INDIANAPOLIS  .  IND 


Fig.  13.     Waste  of  land  where  circle  lots  deepest.     Also  monument 
interferes  with  traffic  in  both  directions  and  injures  both  streets. 


area  covered  by  the  city.  Limiting  this  tendency  would  be  a 
natural  increase  in  the  height  of  buildings,  on  account  of  wide 
streets  and  greater  light  and  air  obtained  on  the  smaller  build- 
ing plots  remaining.  Practically  the  proportion  between  public 
and  private  land  has  but  little  influence  on  the  density  of  city 


GROUND    PLAN    OF    CITIES. 


53 


population,  although  there  is  an  economic  mean  in  the  pro- 
portion between  land  for  communication  and  land  for  buildings, 
which  varies  according  to  the  utilization  of  land  and  which 
makes  itself  felt  when  disregarded  in  either  direction  by  loss  of 
income. 

The  unit,  both  as  to  the  depth  and  width  of  lots,  from  which  a 
plat  should  be  built  up,  consists  of  the  average  shop  in  the  busi_ 
ness  district  and  the  average  dwelling  in  the  residence  district. 
Since  the  growth  of  cities  leads  normally  to  the  ultimate  con- 
version of  residence  land  into  business  land,  a  uniform  system  of 
platting  suitable  for  business  purposes  throughout  the  entire 

I 


EAST 


47- 


EAST 


0-6' 


WEST 


S7' 


West 


S6- 


Old     utilization     of     high-class 
residence     block.      (Shaded     sur- 
faces  represent   houses.) 
New  York, 


Modern  utilization  of  high-class 
residence  block.  Note  increased 
area  covered,  (Shaded  surfaces 
represent   houses.) 


city  is  generally  preferable.  Such  a  system  need  not  necessar- 
ily lead  to  small  holdings  in  the  residence  sections,  although  it 
has  a  tendency  in  that  direction. 

The  average  depth  utilized  by  shops  varies  from  30  or  40  feet 
for  cheap  shops  up  to  70  or  80  feet  for  high  class  shops,  with 
some  department  stores  200  to  400  feet  deep.  The  average 
shop  was  formerly  limited  in  depth  by  the  necessity  of  obtain- 
ing light  from  each  end,  but  this  limitation  has  been  removed 
by  the  use  of  artificial  light  in  the  day  time.  Allowing  30  or  40 
feet  in  the  rear  for  light  and  air,  we  have  a  normal  depth  of  100 
to  120  feet  for  a  lot,  or  a  total  depth,  including  an  alley,  of  200 
to  250  feet  to  the  block.    Very  long  blocks  are  much  less  disad- 


54  PRINCIPLES    OF    CITY    LAND    VALUES. 

vantageous  than  very  deep  ones,  the  unfavorable  feature  here 
being  that  shops  in  the  middle  of  the  long  fronts  are  difficult  of 
access,  as  with  the  side  streets  in  New  York  from  Fourteenth 
Street  up. 

Office  buildings  can  utilize  a  greater  depth  than  shops,  extend- 
ing from  100  to  150  feet,  and  as  to  wholesale  and  warehouse 
buildings,  light  and  air  being  almost  unnecessary,  the  only  limi- 
tation of  depth  is  that  of  convenience  in  handling  goods. 

Residences  erected  in  blocks  are  usually  two  or  three  rooms 


'' tifll 

i  Jj^^H 

^i^^^^i 

^  ^^1 

il 

si 

Planned   as   interior   street,    in   effect   an   alley    through   the   most 
valuable  block  in   Salt   Lake  City.    Frontage   practically   worthless. 

deep,  covering  50  to  70  feet,  so  that  with  an  allowance  for  light 
and  air.  100  to  120  feet  is  also  a  desirable  depth  for  residence 
lots.  Where  residence  land  is  most  valuable  it  is  economized  in 
the  same  way  as  with  office  buildings,  the  entire  area  being 
built  on  except  for  such  light  wells  as  are  necessary  or  required 
by  the  building  laws.  In  some  of  the  best  residence  sections 
of  smaller  cities,  lots  of  extra  depth  are  found,  permitting  the 
dwellings  to  be  set  far  back  from  the  street,  as  with  Euclid  Ave- 
nue. Cleveland,  where  the  lots  on  one  side  of  the  street  are  900 
feet  deep,  and  Meridian  Avenue  in  Indianapolis,  where  the  lots 
on  one  side  of  the  street  are  400  feet  deep.  In  the  outskirts  of 
small  cities  where  land  is  cheap  and  but  a  small  proportion  of 


GROUND    PLAN    OF    CITIES. 


55 


the  land  is  built  upon,  great  depth  is  customarily  made  use  of  for 
gardens,  the  deep  lots  being  cut  by  additional  streets  as  further 
demand  for  building  land  arises. 

As  to  width  of  lots,  these  vary  in  the  smaller  cities  from  20  to 
25  feet  for  mechanics'  homes,  40  to  60  feet  for  medium  class  resi- 
dences or  small  shops,  and  lOO  to  150  feet  for  high-class  resi- 
dences or  the  largest  business  buildings.  In  the  largest  cities 
residence  lots  run  from  12  to  25  feet  and  business  lots  from  25 
to  50  feet,  with  larger  plots  of  100  feet  frontage  or  more  used 


Example  of  too  wide  street.  Street  narrowed  from  100  feet  to  56 
feet.  Sidewalks  moved  to  edges  of  driveway.  Expense  of  maintain- 
ing driveway  reduced  one-half  and  desirable  parking  effects  ob- 
tained.    Macon,  Ga. 


for  large  oflace  buildings,  shops,  hotels,  theatres  or  costly  re«i- 
dences,  the  general  rule  being  the  larger  the  city  the  smaller 
the  average  holding  of  land. 

A  marked  effect  of  the  subdivision  of  land  into  small  lots 
occurs  in  the  largest  cities,  when  large  plots  are  needed,  such 
plots  having  greatly  increased  value,  technically  known  as 
"plottage"  value.  From  one  standpoint  this  represents  the 
"hold-up"  cost  of  securing  the  last  few  lots  of  a  plot,  the  plans 
concerning  which  almost  invariably  leaking  out  and  advantage 
being  taken  of  purchasers'  necessities. 


CHAPTER  V, 

Directions  of  Growth, 

External  influences.— First  lines  of  growth  of  water-front  city 
parallel  to  water  front;  of  inland  town,  along  intersecting 
turnpikes  and  of  railroad  town,  away  from  railroad  station 
along  principal  turnpike.— Contest  between  axial  and  central 
growth.— Normal  city  star-shaped.— Framework  of  cities  laid 
down  by  water  courses,  turnpikes  and  railroads.— Influence  of 
public  buildings  and  exchanges.— Continuity  the  vital  feature. 

The  first  feature  of  any  settlement  to  be  noted  is  its  corre- 
spondence with  external  influences,  the  first  buildings  of  a  com- 
mercial city  clustering  around  the  point  of  origin,  whether  a 
wharf,  railroad  station  or  turnpike  intersection,  in  order  to  han- 
dle the  traflic  from  the  outside  world. 
*jrjn  a  waterfront  city  the  first  line  of  growth  is  normally  along 


Geneva  in  1687.    First  streets  parallel  to  the  water  front. 

the  shore,  both  because  additional  docks  and  buildings  opposite 
them  start  an  axis  of  travel  parallel  to  the  waterfront,  and  also 
because  the  bank  of  a  river  or  harbor  furnishes  a  natural  high- 
way for  the  first  settlers^^the  Strand  in  London  being  the  typical 
first  street  of  a  waterfrint  city.  Thus  the  first  business  street 
of  New  York  was  Pearl  Street,  originally  on  the  shore  line  of  the 
East  River;  of  Chicago,  Water  Street,  on  the  edge  of  the  Chi- 
cago River;  of  Boston,  Washington  Street,  then  in  part  on  the 


DIRECTIONS   OF   GROWTH. 


57 


shore  line;    of   Savannah,  Bay    Street;     of    Bridgeport,    Water 

Street,  &c.,  these  streets  being  now  in  most  cases  a  number  of 

blocks  from  the  water,  owing  to  the  extension  of  land  by  filling. 

A  not  uncommon  variation  in  this  normal  development  has  oc- 


Richmond  in  1781.    Showing  the  first  buildings  on  Main  Street. 

curred  where  a  creek  emptying  into  the  river  or  harbor  made  a 
sheltered  landing-place,  whose  traffic  brought  business  buildings 
on  either  side.  When  the  size  of  ships  was  so  increased  that  the 
creek  became  useless  it  was  filled  up,  the  business  street,  how- 


Utica   in   1802.     Typical   start   of   a   city   at   intersecting   turnpikes. 

ever,  remaining,  as  with  Broad  Street  in  New  York;  Dock  Street 
in  Philadelphia,  and  Canal  Street  in  New  Orleans.  Where  the 
topography  of  the  waterfront,  either  because  of  shallow  water  at 
each  end  or  of  cliffs  along  the  banks,  is  such  that  only  one  good 


h 


58  PRINCIPLES    OP    CITY    LAND    VALUES. 

approach  to  the  water  exists,  the  first  business  street  will  nor- 
mally extend  back  from  the  waterfront  up  the  hollow  between 
the  hills,  as  at  Evansville,  Montgomery  and  Kansas  OUy. 

In  the  case  of  an  inland  town  there  may  be  four  or  more  direc- 
tions of  growth  along  the  lines  of  the  intersecting  turnpikes. 
Where  an  inland  city  originates  from  a  railroad,  the  railroad 
station  takes  the  place  of  the  wharves  of  a  waterfront  city,  and 
the  first  direction  of  growth  is  along  the  turnpike  leading 
t J  the  largest  body  of  productive  farming  land.  Since  this  usu- 
ally lies  along  the  valley  through  which  the  railroad  runs,  the 
first  axis  of  growth  is  commonly  parallel  to  the  railroad.  Wher- 
ever a  town  is  found,  in  which  the  railroad  station  is  evidently 


Cleveland,  170G.    The  first  streets  run  up  the  hill  from  the 
river  docks. 

apart  from  the  organic  structure  of  the  town,  it  is  clear  that 
the  town  existed  before  the  railroad  reached  it. 

The  chief  exceptions  to  these  general  principles  would  be 
where  inland  villages  arose  before  their  turnpikes  were  of  im- 
portance, as  with  Lancaster  growing  up  about  a  spring;  Syra- 
cuse near  the  salt  wells;  Indianapolis  artificially  laid  out,  but 
with  the  settlers  shifted  over  the  city's  site,  first,  by  absence  of 
timber  on  part  of  the  city  plat,  next  by  the  terminus  of  the  canal, 
and  next  by  the  location  of  the  National  Pike. 

In  their  methods  of  growth  cities  conform  always  to  biological 
laws,  all  growth  being  either  central  or  axial.  In  some  cities 
central  growth  occurs  first  and  in  others  axial  growth,  but  all 
cities  illustrate  both  forms  of  growth  and  in  all  cases  central 


DIRECTIONS   OF    GROWTH. 


59 


growth  includes  some  axial  growth,  and  axial  growth  some  cen- 
tral growth.  Central  growth  consists  of  the  clustering  of  utili- 
ties around  any  point  of  attraction  and  is  based  on  proximity, 
while  axial  growth  is  the  result  of  transportation  facilities  and 
is  based  on  accessibility.  A  continual  contest  exists  between 
axial  growth  pushing  out  from  the  centre  along  transportation 
lines  and  central  growth,  constantly  following  and  obliterating 
it,  while  new  projections  are  being  made  further  out  the 
various  axes.  The  normal  result  of  axial  and  central  growth  is  a 
star-shaped  city,  growth  extending  first  along  the  main  thor- 
oughfares radiating  from  the  centre,  and  later  filling  in  the 
parts  lying  between.     The  modifications  of  the  shape  of  cities 


'^^1^^^ 


Portland,    Ore.     Showing  first   growth   along   river   bank. 


come  chiefly  from  topography,  the  lesser  influences  being  an 
uneven  development  of  some  one  factor  of  growth  or  individual 
ownership  of  land. 

\Turning  first  to  axial  growth,  the  frame-work  of  a  city  is  laid 
down  by  its  water  courses,  turnpikes  and  railroads.  Of  these, 
the  turnpikes  in  the  older  cities  are  of  chief  importance. 
Before  the  days  of  railroads  these  controlled  so  much  outside 
traflac  that  their  city  ends  became  the  principal  business  streets, 
and  many  still  maintain  their  supremacy.  For  example,  Broad- 
way in  New  York  was  part  of  the  old  Albany  turnpike  which 
runs  on  to  Montreal;  Washington  Street  in  Boston  was  the  turn- 
pike to  New  York,  which  in  passing  through  Providence  was 
known  as  Westminster  Street;  Main  Street  in  Hartford  was  the 


\^ 


60  PRINCIPLES    OF    CITY    LAND    VALUES. 

New  Haven  *;urnpike,  which  continued  north  of  Hartford  as  the 
Albany  and  Windsor  turnpikes;  Montgomery  Street  in  Jersey 
City  was  the  through  road  from  New  York  to  the  south,  which, 
continuing  out  Newark  Avenue,  runs  through  Newark  as  Broad 
Street,  and  so  on  to  Philadelphia;  the  National  Pike  built  from 
Washington  to  the  west  one  hundred  years  ago,  runs  through 
Wheeling  as  Market  Street,  Columbus  as  Broad  Street,  Indian- 
apolis as  Washington  Street,  Terre  Haute  as  Main  Street,  and 
so  on;  and  in  Kansas  City  Main  Street  was  the  old  Sante  Pe 
trail,  running  a  thousand  miles  from  the  Missouri  River  to 
Santa  Fe. 

Turnpikes  are  the  natural  outlets  for  residences  forced  away 


Wheeling,  W.  Va.,  in  1845.    Showing  first  growth  parallel  to  river. 
The  road  over  the  hill  is  the  National   Pike. 

from  the  business  centre  and  in  small  towns  attract  the  inhabi- 
tants by  the  human  interest  and  protection  of  the  passing  travel. 
Growth  along  turnpikes  continues  to  a  point  where  the  incon- 
venience of  living  so  far  out  of  town  more  than  offsets  the  at- 
tractions of  the  turnpike  when  back  streets  are  laid  out. 

Steam  railroads  affect  city  land  in  three  ways:  First,  by  their 
terminals;  second,  by  their  lines  as  barriers  to  growth  or  com- 
munication; and,  third,  by  their  lines  as  influencing  land  imme- 
diately adjacent.  The  central  effect  of  a  passenger  depot  in  a 
small  city  is  to  attract  cheap  hotels  and  shops,  such  abnormal 
cases  as  the  vacant  lots  opposite  the  Union  depots  in  Toledo  and 
New  Haven  being  due  to  railroad  ownership  of  the  land.    In  the 


DIRECTIONS   OP    GROWTH. 


61 


larger  cities  high  class  hotels  gather  near  the  principal  depots, 
as  in  New  \ork  and  Boston,  and  in  England,  where  they  are  fre- 
quently built  as  a  part  of  the  railroad  station  itself. 
The  axial  effect  of  railroad  depots  is  of  great  importance  in  the 


Cincinnati   in  1810.     First  houses   along  the  river  bank. 

smaller  towns,  where  the  depot  constitutes  one  of  the  strongest 
single  forces  attracting  traffic  within  the  city.  The  distribution 
of  this  axial  effect  depends  upon  whether  the  travel  to  and  from 


Chicago  in  1820.    First  houses  at  the  mouth  of  the  river. 

the  depot  is  concentrated  on  one  principal  street,  or  whether  the 
streams  of  travel  pass  through  a  large  number  of  streets.  Ordi- 
narily the  railroad  terminal  occupies  so  much  area,  and  blocks 
so  many  streets  that  it  is  most  conveniently  approached  by  one 


■ 


62 


PRINCIPLES    OF    CITY    LAND    VALUES. 


Street.  The  axial  effect  of  a  depot  is  more  easily  noted  when  it 
is  located  a  few  blocks  from  a  through  traffic  street  than  if  lo- 
cated on  such  a  street,  the  travel  off  the  through  street  being 
then  directly  due  to  the  depot  and  not  being  mingled  with  the 
general  travel.  In  some  cases  a  depot  blocks  the  end  or  furnishes 
the  beginning  of  a  street  which  would  for  other  reasons  have 
been  a  good  street,  but  which  is  greatly  strengthened  by  the  de- 
pot, as  with  17th  Street  in  Denver.  Freight  depots  are  com- 
monly a  part  of  passenger  terminals  and  attract  warehouses, 
heavy  wholesalers  and  tenements. 

The  restraining  effect  of  railroads,  whether  main  or  belt  lines, 
varies  according  to  the  territory  traversed.  Where  a  railroad 
runs  through  a  business  section  at  grade,  it  limits  communica- 
tion between  the  divided  sections  and  tends  to  concentrate  busi- 
ness on  one  side  of  the  line.    Where  a  railroad  in  a  business  sec- 


Dawson  City,  Alaska,  1899.    Sho^ 


tion  is  carried  below  or  above  grade,  its  effect  is  minimized.  In 
a  poor  residence  section  a  railroad  has  but  little  effect,  but  in  a 
high  class  residence  section  it  forms  a  nuisance  which  good  resi- 
dences shun.  Added  to  the  noise  and  cinders  of  passing  trains  is 
the  fact  that  the  railroad  attracts  factories  and  warehouses, 
which  are  also  nuisances  in  a  residence  district.  In  some  in- 
stances the  railroad  travels  along  the  line  of  a  small  creek  or 
gully  within  the  city,  which  has  already  kept  land  values  down, 
so  that  the  railroad  has  but  little  added  effect,  as  with  the 
greater  part  of  the  Belt  Line  in  Kansas  City.  If  the  railroad  is 
in  a  deep  cut,  its  limiting  effect  on  good  residences  is  diminished, 
as  in  Chattanooga  and  St.  Paul.  In  some  cities  demand  for  land 
in  the  good  residence  district  is  so  great  that  the  residence  dis- 
trict is  projected  beyond  the  encircling  railroad  with  little  fall 
in  values,  as  in  Louisville  and  Richmond,  where  handsome  resi- 


DIRECTIONS   OF    GROWTH.  03 

dences  are  built  adjacent  to  the  railroad.  In  New  York,  the  N. 
Y.  Central  R.  R.  on  Park  Avenue,  between  42d  and  56th 
Streets,  holds  the  high  class  residences  on  the  west  side  of  the 
track,  the  east  side  of  the  track  being  ruined  by  absence  of  ap- 
proach, the  only  communication  being  by  the  elevated  foot 
bridges.  From  56th  Street  north  the  tracks  enter  the  tunnel  and 
their  effect  is  lessened-,  the  only  objection  being  the  vent  holes 
in  Park  Avenue.  In  all  cities  railroads  detach  great  slices  of 
city  area,  in  which  they  alter  utilizations  and  values  much  as 
important  water  courses  do. 

The  effect  of  railroads  on  adjacent  frontage  is  to  prevent  its 
use  for  either  shops  or  residences,  the  chief  exception  to  this  be- 
ing in  small  towns  where  the  street  facing  the  railroad  often 
starts  as  the  principal  business  street,  this  conditions  still  sur- 
viving in  Syracuse. 


growth  along  river  bank. 


Water  fronts,  if  navigable,  invite  commerce,  resulting  in  docks 
and  warehouses,  and  away  from  the  city  centre,  attract  factories. 
If  not  navigable  and  not  bordered  by  railroads,  and  if  the  land  is 
not  low,  they  attract  residences,  as  in  Chicago,  north  of  the  Chi- 
cago River;  in  Charleston,  and  formerly  in  New  York,  when  the 
best  residences  faced  the  Battery  Park.  Where  the  land  rises 
sharply  fifty  or  more  feet  above  the  river  level,  so  that  the  rail- 
roads and  traffic  along  the  water  are  not  seen  or  heard  on  the 
hill  above,  residences  are  attracted,  as  in  the  Riverside  Drive 
district  in  New  York;  the  Summit  Avenue  district  in  St.  Paul; 
the  Independence  Avenue  district  in  Kansas  City,  and  the  Wal- 
nut Hill  district  in  Cincinnati. 

Turning  to  central  growth,  this  has  two  aspects,  first  the  main 
general  growth  in  all  directions  from  the  point  of  origin,  second 
the  growth  from  various  sub-centres  within  the  city,  such  as 


t>4 


PRINCIPLES    OF    CITY    LAND    VALUES. 


Washington    about    1840,    looking    up    Pennsylvania    Ave.    from    the 
White  House  to  the  Capitol. 

transportation  termini,  public     buildings,  exchanges,  factories, 
hotels,  &c. 

The  first  and  simplest  form  of  central  growth  is  that  of  aggre- 
gation or  adding  of  buildings  one  after  another  along  the  streets 
leading  from  the  centre  of  the  city.  The  first  dwellings  in  a  vil- 


Broad  street  canal  of  New  York  in  1R50.    Location  of  early  mercan- 
tile houses  and  the  first  exchange. 


DIRECTIONS   OF    GROWTH. 


65 


lage  are  located  near  the  business  buildings,  so  that  the  mer- 
chants can  walk  to  and  from  their  business,  and  so  great  is  the 
power  of  inertia  that  even  in  the  smallest  villages  the  few  stores 
find  it  advantageous  to  be  close  together. 

The  influence  of  public  buildings  on  the  structure  of  a  com- 
mercial city  is  small,  unless  such  a  commercial  city  is  also  a 
national  capital,  as  with  London  and  Paris.  Where  a  city  is 
wholly  a  political  city,  as  is  Washington,  the  public  buildings 
largely  determine  the  structure  of  the  city.  The  smaller  public 
buildings  found  in  all  cities,  such  as  the  Post  Oflace  and  City 
Hall,   have  considerable  influence  in  determininig  the  line  of 


Richmond,    Va. 


about    1^0.     Showing    growth    along   river    and   up 
gradual   slope  to   the  south. 


early  growth,  but  are  of  constantly  diminishing  importance  as 
the  other  factors  of  a  city's  life  become  stronger,  so  that  not  in- 
frequently the  public  building  which  created  a  street  in  time  be- 
comes a  detriment  to  it.  It  is  easy  to  find  public  buildings  badly 
located  which  have  no  effect  on  the  city's  structure,  as  the  Post 
Oflice  in  Chattanooga,  the  County  Court  Houses  in  Salt  Lake 
City,  Kansas  City,  Seattle  and  Tacoma,  and  the  State  Capital  in 
Salt  Lake  City.  If  the  City  Hall  includes  a  public  market  for 
the  sale  of  vegetables,  fruit,  meat,  &c.,  this  being  similar  to  a 
large  shop  attracts  much  daily  travel,  a  good  example  being  in 
Knoxville.     In  some  cities,  as  i^  Columbus    and    Dayton,    0., 


G6 


PRINCIPLES    OF    CITY    LAND     VALUES. 


Farnam  St.,  Omaha,  1863.     Old  buildings  replaced  by  modern  ones, 
leaving  but  few  traces  of  first  growth. 


r^^ 


St.  Paul  in  l.Sd.s.  «.;il>  f,iarted  at  deep  water  and  high  bank, 
making  good  steamboat  landing.  Climbed  hill  to  "Seven  Corners," 
then  grew  east  on  lower  level  towards  railroad  station. 


DIRECTIONS   OF    GROWTH. 


67 


farmers  sell  their  products  from  wagons  on  certain  streets 
of  the  city  on  market  days.  When  this  was  first  instituted  the 
shop-keepers  on  these  streets  feared  injury  to  their  trade  and 
secured  the  passage  of  a  city  ordinance  prohibiting  it.  Finding 
later  that  they  had  lost  patronage  by  the  removal  of  the  farmers' 
wagons,  they  petitioned  for  their  return,  this  experience  showing 
the  value  to  shop-keepers  of  massing  people  in  front  of  their 
stores,  even  though  the  new  attracting  force  consists  of  com- 
petitive sellers.  The  practice  of  surrounding  public  buildings 
with  large  grounds  is  a  common  one,  by  which  their  influence  is 
nullified,  the  net  effect  being  similar  to  that  of  a  small  park. 
Such  a  small  park,  even  though  including  a  public  building, 
makes  a  bad  break  on  a  through  business  street,  injuring  espe- 
cially the  adjacent  property  on  the  same  side  of  the  street.     It 


Water  front  of  Seattle,  1878.  No  commerce  demanded  docks,  so 
water  front  was  bulkheaded.  Two  new  streets  have  since  been  laid 
out  over  the  water,  and  continuous  docks  built. 


a^ay  sometimes  slightly  enhance  the  value  of  the  business  prop- 
erty facing  it  by  concentrating  travel  on  that  side  of  the  street, 
and  in  the  largest  cities  furnishes  a  desirable  outlook  for  high 
office  buildings.  The  most  detrimental  effect  of  such  p.  public 
building  in  a  small  park  is  felt  in  the  early  stages  of  a  city, 
where  the  park  checks  the  extension  of  the  business  centre.  A 
public  building  surrounded  by  a  park,  if  located  in  a  residence 
section,  tends  to  attract  good  residences,  the  outlook  for  the 
park  more  than  off-setting  what  travel  comes  to  the  public 
building. 

To  summarize  the  effect  of  public  buildings,  if  located  at  or 
near  the  old  business  centre,  they  tend  to  maintain  central 
strength  in  their  first  location,  as  in  Boston,  New  York,  Phila- 
delphia and  Chicago.  This  is  the  normal  case.  The  first  excep- 
tions would  be  where  public  buildings  are  located  at  a  moderate 


68 


PRINCIPLES    OF    CITY    LAND    VALUES. 


Macon,  Ga.     The  point  of  origin,  where  bridge  croocta  irom  East   Macon,  which  was  fli 
settled.    This  frontage  formerly  the  highest  priced  in  the  city,  now  worth     about     $10 
front  foot. 


Paris.   Central  growth  exhibited  by  successive  encircling  boulevards,  formerly  fortiflcatio: 


DIRECTIONS   OF    GROWTH. 


69 


Brooklyn.  Illustrates  growth  along  the  axis  of  the  Long  Island  R.  R. 


Boston.    Illustrates  central  growth  at  points  on  railroad  axis,  issuing  from  the  city. 


70 


PRINCIPLES    OP    CITY    LAND    VALUES. 


distance  from  the  centre  where  the  tendency  is  to  draw  business 
in  their  direction,  and  the  second  where  they  have  been  so  mia- 
placed  as  to  fail  to  have  any  influence. 

Arising  later  in  the  life  of  a  city,  but  in  time  acquiring  more 
central  influence  than  any  other  factor,  are  the  Exchanges,  such 
as  the  Stock  Exchange,  Produce  Exchange,  Cotton  Exchange, 
Coffee  Exchange,  Wool  Exchange,  &c.  The  New  York  Stock 
Exchange  is  the  strongest  single  influence  maintaining  the  flnan- 
cial  section.  The  proposition  considered  some  years  ago  of  mov- 
ing the  Stock  Exchange  above  Prince  Street,  and  on  another 


Fine  old  Southern  residence  separated  from  its  neighborhood  by 
railroad  cutting.  Value  of  land  and  building  destroyed.  Mont- 
gomery, Ala. 


occasion  to  14th  Street,  if  accomplished  would  have  removed  all 
the  Stock  Exchange  brokers  and  the  majority  of  the  Banks  and 
Trust  Companies,  private  bankers.  Safe  Deposit  Companies  and 
lawyers,  with  disastrous  results  on  land  values  in  the  financial 
section.  The  leading  Exchange  varies  in  different  cities  accord- 
ing to  the  dominant  form  of  business.  The  Board  of  Trade, 
handling  the  grain  business,  is  the  leading  Exchange  of  Chicago 
and  Minneapolis;  the  Cotton  Exchange  of  New  Orleans,  Savan- 
nah and  Mobile;  and  the  Mining  Exchange  of  Denver  and  Colo- 
rado Springs. 

Factories  create  sub-centres,  most  distinct  when  on  the  out- 
skirts of  cities,  by  causing  the  erection  of  laborers'  cottages  near 


DIRECTIONS   OF    GROWTH. 


71 


b 


Charleroux,    France.      Illustrates     first     lines     of     buildings     along 
roads,  which  form  large  irregular  blocks,  later  subdivided. 


I 


72 


PRINCIPLES    OF    CITY    LAND    VALUES. 


1 1  ill  K'..  >^  4^--/L.  ■ '' 


Vienna,   1873.     Showing  fortifications   and   surrounding  ring   (used 
as  a  park),  which  made  the  old  business  center,  in  effect,  an  island. 


DIRECTIONS  OF   GROWTH. 


73 


Vienna,  1898.     Showing  ring  outside  the  old  fortifications,  platted    into    regular   blocks. 
These   now    highly    improved   with   municipal  and  public  buildings,  apartment  houses,  &c. 


74 


PRINCIPLES    OF    CITY    LAND    VALUES. 


the  factory,  which  in  turn  attract  small  shops  and  public  and 
semi-public  buildings.  Where  factories  are  erected  within  the 
built-up  section  of  the  city,  their  central  effect  mingles  with  that 
of  other  factors,  but  attracts  tenements  near  at  hand. 

In  all  growth,  central  or  axial,  great  or  small,  the  vital  feature 
is  continuity,  the  universal  tendency  being  to  add  on  buildings 
one  by  one,  of  the  same  general  character  as  those  which  pre- 
ceded them.  Lack  of  continuity  from  whatever  cause  explains 
many  of  the  greatest  disappointments  in  anticipated  real  estate 
movements,  such  as  for  example  the  failure  of  the  west  side  In 
New  York,  when  first  developed,  to  attract  fine  residences.  While 
growth  in  general  is  continuous,  in  detail  it  may  hasten  on,  leav- 
ing vacant  places  behind,  especially  where  rapid  transit  draws 
it,  the  stations  of  the  elevated  railroad  on  the  west  side  at  72d, 
81st,  93d,  104th  and  116th  Streets  being  starting  points  in  new 
territory  from  which  growth  took  place  in  all  directions. 


Atlanta.      Example    of    star-shaped    city. 
(See  page  47.) 


CHAPTER  VI. 

Distribution  of  Utilities, 

As  city  evolves,   continual  specialization  in  business  and  dif- 
ferentiation   in  social  grades.— Classification  of  utilities  and  lo- 
cations sought.— Distribution    of   business   utilities,     economics* 
of  residence  values,  social,  Movement  of  point  of  highest  value. 
Direction   and  rate. 

The  physical  evolution  of  a  large  city  from  a  small  one  results 
not  only  from  increased  population  and  added  industries,  but 
also  from  continual  specialization  in  business  and  differentiation 
in  social  grades.  The  first  step  is  the  separation  between  busi- 
ness and  dwellings,  the  original  buildings  used  for  business 
below  and  dwelling  above  being  replaced  by  separate  business 
and  residence  buildings.  Later  the  social  activities  in  educa- 
tional, charitable  and  recreational  lines,  become  organized  and 
evidence  themselves  in  schools,  hospitals,  theatres  and  clubs, 
increasing  diversity  of  function  resulting  in  increased  diversity 
of  structure.  Analyzing  city  land  according  to  its  utilization, 
it  may  be  divided  into  three  main  classes,  that  used  for  business, 
that  for  residences  and  that  for  public  or  semi-public  buildings. 

Business  land  may  be  subdivided  into  that  used  for  distribu- 
tion— retail  or  wholesale  stores  and  railroads — that  used  for  ad- 
ministration— banking  and  office  property — and  that  used  for 
production — manufacturing  property. 

Residence  land  may  be  subdivided  into  that  occupied  by  a  sin- 
gle tenant,  ranging  from  the  cottage  to  the  palace,  and  that  occu- 
pied by  more  than  one  tenant,  ranging  from  tenements  to  apart- 
ments and  hotels. 

Land  used  for  public  or  semi-public  buildings  includes  that 
used  by  the  Post  Office,  City  Hall,  County  Court  House,  &c.,  and 
by  all  such  institutions  as  asylums,  hospitals,  churches,  libraries, 
museums,  clubs,  &". 

The  locations  sought  by  these  utilities  and  the  reasons  therefor 
seem  to  be  as  follows:  Retail  stores  either  cluster  at  the  busi- 
ness centre  or  follow  out  traffic  streets.  In  retailing  the  buyer 
necessarily  seeks  the  seller,  but  since  in  all  forms  of  trade  it  is  / 
the  seller  who  is  anxious  to  promote  business,  the  retailer  facil- 
itates his  possible  customers  by  placing  his  shop  where  the  larg- 
est number  of  them  would  pass,  even  though  his  shop  were  not 
there.    Here  he  utilizes  his  shop  windows  and  signs  to  draw  cus- 


• 


* 


76 


PRINCIPLiES    OF    CITY    LAND    VALUES. 


tomers  into  his  shop,  the  two  elements  of  convenience  of  location 
and  advertising  advantage  working  hand  in  hand. 

Wholesaling  may  be  divided  into  two  main  classes:  First, 
wholesaling  of  objects  of  great  weight  or  bulk  but  relatively- 
small  value,  which  seeks  locations  near  transportation  lines  or 
termini  for  economy  of  handling,  the  selling  being  done  by 
traveling  salesmen  or  by  selling  agencies  located  in  the  business 
centre;  and  second  wholesaling  of  articles  of  small  bulk  but  high 
value  In  the  retail- whole  sale  way,  that  is,  making  up  an  order 
including  a  variety  of  objects  for  the  trade  only — which  seeks 
locations  near  their  chief  customers,  the  retail  stores.   Here  the 


Second  Street,  Seattle,  in  1876,  looking  south.  Lots  which  sold  in 
1860  for  $10  now  bring  $120,000.  None  of  the  original  buildings 
survive. 


ability  to  quickly  supply  a  small  order  of  mixed  goods  is  sufll- 
ciently  important  to  induce  them  to  pay  considerable  rents. 

Railroads  in  striving  for  passenger  traflSc  project  their  passen- 
ger terminals  as  far  as  possible  towards  the  business  centre  of  a 
city.  Economy  of  handling  freight  locates  the  freight  depots 
either  near  the  docks  for  interchange  of  freight  or  near  the 
heavy  business  houses. 

In  the  largest  cities  a  separate  section  evolves  devoted  to  of- 
fice buildings,  whose  ground  floors  are  utilized  by  banks,  trust 
companies,  insurance  companies,  &c.,  and  whose  offices  are 
rented  to  brokers,  lawyers,  architects,  &c.,  the  location  of  such 
an  administrative  district  being  usually  the  result  of  slow 
growth  around  old  institutions. 


DISTRIBUTION    OF    UTILITIES.  77 

Manufacturing  follows  similar  lines  to  wholesaling,  the  pro- 
duction of  articles  of  great  weight  or  bulk  and  small  value  seek- 
ing the  waterfronts  or  railroads  away  from  the  centre  of  the 
city,  both  for  economy  in  handling  the  product  and  because  re- 
quiring a  large  area  for  a  low  utilization  they  must  have  cheap 
land.  The  manufacture  of  light  articles  of  high  value  or  that 
which  consists  of  the  final  combination  or  finishing  of  products 
seeks  the  wholesale  or  retail  stores  which  form  their  custom- 
ers. In  such  manufacturing  the  seller  seeks  the  buyer  and  sells 
.by  sample,  so  that  a  location  with  an  advertising  value  is  not 
imperative,  but  the  requirement  of  constant  visits  to  customers 


:li 


Memphis  levee,  showing  use  of  waterfront  where  marked  changes 
of  river  levels  occur.  Absence  of  docks  prevents  localizing  of  river 
business,  and  resulting  effects  on  city  structure. 


and  the  ability  to  supply  small  articles  quickly,  cause  surh  man- 
ufacturers to  pay  considerable  rents. 

In  general  the  basis  of  the  distribution  of  all  business  utilities 
is  purely  economic,  land  going  to  the  highest  bidder  and  the 
highest  bidder  being  the  one  who  can  make  the  land  earn  the 
largest  amount.  We  may  note  that  the  better  the  location  the 
more  uses  to  which  it  can  be  put,  hence  the  more  bidders  for  it. 

On  the  other  hand,  the  basis  of  residence  values  is  social 
and  not  economic — even  though  the  land  goes  to  the  highest 
bidder— the  rich  selecting  the  locations  which  please  them, 
those  of  moderate  means  living  as  near  by  as  possible,  and 


78  PRINCIPLES    OF    CITY    LAND    VALUES. 

SO  on  down  the  scale  of  wealth,  the  poorest  workmen  taking 
the  final  leavings,  either  adjacent  to  such  nuisances  as 
factories,  railroads,  docks,  &c.,  or  far  out  of  the  city. 
Certain  features  appear  to  attract  the  wealthy  in  selecting  their 
residence  districts,  among  these  being  nearness  to  parks, 
a  good  approach  from  the  business  centre,  not  too  near  nor 
yet  too  far,  a  moderate  elevation  if  obtainable,  favorable  trans- 
portation facilities,  despite  the  fact  that  the  rich  ride  in  their 
own  carriages  and  automobiles,  and  above  all  absence  of  nui- 
sances. Having  selected  a  district  the  wealthy  make  it  their  own 
by  erecting  handsome  residences,  making  good  street  improve- 
ments, restricting  against  nuisances,  and  finally  and  of  chief 
importance  living  there  themselves,  the  value  of  residence  land 
varying  directly  according  to  the  social  standing  of  its  occu- 
pants. The  main  consideration  in  the  individual  selection  of  a 
residence  location  is  the  desire  to  live  among  one's  friends  or 
among  those  whom  one  desires  to  have  for  friends;  for  which 
reason  there  will  be  as  many  residence  neighborhoods  in  a  city 
as  there  are  social  strata.  In  securing  a  home  in  a  good  residence 
section  a  man  secures  safe,  healthy  and  attractive  conditions  for 
his  family  to  live  under,  and  in  the  smaller  cities,  desirable  so- 
cial life,  these  social  considerations  explaining  the  strong  press- 
ure in  all  cities  towards  the  best  residence  sections.  The  contrast 
should  be  noted  that  business  property  is  selected  by  the  man 
from  an  economic  standpoint,  and  residence  property  by  the 
woman  from  a  social  standpoint.  Social  growth  and  pressure  is 
upwards  from  class  to  class,  all  ranks  being  continually  recruited 
from  below — as  well  as  dropping  members  from  time  to  time — 
and  the  ultimate  aim  in  residence  location  is  to  be  as  close  as 
possible  to  those  of  the  highest  social  position. 

Where  residences  contain  more  than  one  tenant,  whether  tene- 
ments, flats,  apartments  or  hotels,  the  basis  of  value  is  economic 
and  conforms  closely  to  the  principles  governing  business  prop- 
erty. The  hotels  of  various  classes  seek  locations  similar  to  the 
retail  stores  of  the  same  classes  on  convenient  traffic  streets 
which  advertise  them.  The  highest  class  apartment  hotels  seek 
locations  on  or  near  such  traffic  streets  as  run  through  or  near 
the  fashionable  districts,  the  rents  being  dependent  both  upon 
fashion  and  on  the  character  and  service  of  the  building.  Below 
this  grade  the  various  classes  of  flats  seek  locations  for  the  con- 
venience of  their  tenants,  tending  to  draw  nearer  and  nearer  to 
their  tenant's  places  of  business,  until  finally  we  reach  tene- 
ments crowded  among  the  factories  where  their  occupants  work. 

Turning  to  the  main  central  growth  of  cities,  a  successful  busi- 
ness at  or  near  the  city  centre  which  requires  more  space  can 


DISTRIBUTION    OP    UTILITIES. 


79 


secure  it  either  by  acquiring  adjoining  ground,  by  building 
higher  in  the  air,  or  by  moving  away  from  the  centre.  To  build 
higher  in  the  air  solves  the  problem  in  a  banking  and  office  dis- 
trict, but  not  in  a  retail  shopping  district,  where  ground  floor 
frontage  on  traffic  streets  is  required.  Whether  an  adjoining  lot 
is  acquired  or  the  shopkeeper  himself  moves,  the  result  is  the 
same,  which  is  the  starting  of  the  movement  away  from  the  cen- 


nv-j"i!    'a"  ^   -^'  ■ 

■ft  ^-.t    ^fii^fc-^"^^  ■;        ^      .   ■ 

■    ^  ■  ■■  '^^■-             "              i' 

•3; 

Utilization  of  shallow  harbor  for  warehouses  and  railroads.    Duluth. 


tre,  a  slow  but  endless  procession.  The  fact  that  land  is  cheaper 
away  from  the  centre  has  a  slight  tendency  to  further  promote 
the  outward  movement,  which  continually  evidences  the  Unsta- 
ble equilibrium  between  the  centripetal  force  of  economy'-  in  the 
transaction  of  business  and  the  centrifugal  force  of  cheap  land. 
The  uniform  tendency  as  a  city  grows  is  toward  greater  concen- 
tration in  the  business  centre  and  greater  dispersion  in  the  resi- 
dence sections,  and  as  long  as  there  is  an  outward  movement,  so 


80 


PRINCIPLES    OF    CITY    LAND    VALUES. 


long  is  there  certain  to  be  a  continual  readjustment  at  the  busi- 
ness centre  to  conform  to  it. 

The  various  embryonic  sections  gathered  closely  together  in 
the  first  small  area  of  the  city,  in  expanding  largely  influenct 
the  location  of  utilities.  Whatever  the  new  building  to  be 
erected,  whether  retail  or  wholesale,  shop  or  residence,  it  can 


Union  Railroad  Depot,  Toledo.  An  exceptional  case  of  non-utiliza- 
tion of  frontage  opposite  an  important  depot  due  to  railroad  owner- 
ship of  land.  Many  thousands  of  dollars  of  income  thrown  away 
by  not  making  short-time  ground  leases. 


either  be  placed  next  to  similar  buildings  or  apart  from  them. 
With  this  choice,  buildings  are  usually  placed  adjacent  to 
others  of  a  similar  kind,  so  that  the  general  tendency  for  all 
sections  is  to  extend  continuously,  expanding  in  breadth  as  the 
centre  is  left.  One  expensive  residence,  if  not  overcome  by  un- 
favorable factors,  may  be  suflacient  to  attract  similar  buildings 
and  create  the  most  fashionable  residence  street  in  a  city,  as  in 


DISTRIBUTION    OF    UTILITIES. 


81 


a  more  marked  way  the  royal  palaces  in  Paris  and  London  have 
created  the  most  fashionable  residence  districts  in  those  cities. 
This,  however,  does  not  mean  that  individual  enterprise  or  whim 
can  run  counter  to  the  orderly  evolution  of  a  city. 

When  the  best  residence  district  is  determined,  the  main 
growth  of  the  city  is  quite  certain  to  follow  it,  as  note  the  move- 
ment of  retail  stores  after  the  best  residences  on  Fifth  Avenue 
in  New  York;  on  Boylston  Street  in  Boston;  on  Michigan  Ave- 
nue in  Chicago;  on  Olive  and  Locust  Streets  in  St.  Louis;  on 
Madison,  Monroe  and  Jefferson  Streets  in  Toledo;  on  Morrison 
and  Washington  Streets  in  Portland,  Ore.;  on  St.  Charles,  Ca- 
rondelet  and  Baronne  Streets  in  New  Orleans,  &c.  The  reason 
the  best  residence  district  rather  than  the  largest  residence  dis- 


Clark   Street,   Chicago,   in  1857.    Showing  raised   buildings   and 
sidewalks,  as  city  level  was  altered. 


trict  draws  the  city,  is  doubtless  that  the  far  higher  percentage 
of  purchasing  power  of  the  wealthy  more  than  offsets  the  supe- 
rior numbers  of  the  poorer  classes,  and  to  the  further  fact  that 
the  shops  patronized  by  the  wealthy  become  fashionable,  and 
hence  sought  by  all  classes  as  far  as  their  means  permit. 

Exceptions  to  this  progression  are  due  chiefly  to  topography, 
business  remaining  on  a  level  if  possible  and  climbing  hills  only 
under  great  pressure.  A  further  exception  to  the  normal  would 
be  where  two  or  more  good  residence  districts  are  located  on 
opposite  sides  of  the  main  business  section  so  as  to  balance  each 
other,  as  in  Fort  Wayne  and  Knoxville. 

Probably  the  most  important  movement  within  a  city  as  it 
grows  is  the  gathering  together  of  those  carrying  on  the  same 
kind  of  business  into  special  districts.    This  tendency  was  com- 


82 


PRINCIPLES    OF    CITY    LAND    VALUES. 


mon  in  Rome  and  Constantinople  thousands  of  years  ago,  and 
is  in  harmony  with  the  law  of  evolution,  that  increasing  differ- 
entiation is  accompanied  by  increased  integration.  Retail  stores 
cluster  together  at  convenient  points  for  their  customers  and  not 
because  they  do  business  with  each  other.  The  chief  attracting 
power  of  such  a  retail  section  seems  to  be  the  insurance  to  cus- 
tomers against  failure  to  find  within  the  section  what  they  seek. 
Undoubtedly  the  selection  within  this  special  district  is  normally 
better  than  that  in  all  the  rest  of  the  city  combined,  and  shop- 


Example  of  absence  of  Influence  of  public  building.  Post  oflice  in 
Chattanooga,  erected  twelve  years  ago,  away  from  business  center, 
has  attracted  no  business. 


pers  are  saved  the  time,  trouble  and  uncertainty  of  seeking 
through  scattered  shops.  While  one  shop  may  attract  a  cus- 
tomer and  another  make  the  sale,  such  an  interchange  of  cus- 
tomers is  probably  in  the  long  run  closely  balanced.  The  per- 
sonal factor,  or  the  business  ability  of  managers  to  advertise 
and  develop  a  business,  is  most  influential  in  causing  gradations 
of  values  in  adjacent  business  locations.  A  successful  shop  con- 
tinually enlarges  the  area  from  which  it  draws  custom  and  di- 
verts special  currents  of  travel  towards  it.    This  attracts  the  no- 


DISTRIBUTION    OF    UTILITIES. 


8a 


tice  of  other  shops  in  the  same  line  of  business,  who,  reasoning 
either  that  the  location  has  helped  their  successful  rival  or  that 
by  moving  near  them  they  can  secure  some  of  their  customers, 
move  close  to  the  successful  store.  Formerly  it  was  held  that 
the  further  a  retail  store  was  removed  from  a  competitor  the 
better,  but  this  has  been  found  to  hold  true  only  of  those  small 


n 
d 


Perry  Street,  Montgomery,  Ala.  A  curious  example  of  the  most 
fashionable  residence  street  ending  abruptly  in  a  meadow,  only 
thi-ee  blocks  from  fine  houses.  Of  course  axial  strength  is  not 
necessary  for  residence  streets. 


stores  which  depend  for  business  on  the  immediate  neighbor- 
hood. 

In  many  forms  of  business  the  clustering  together  of  those 
transacting  it  finally  crystalizes  into  an  Exchange,  which  forms 
the  centre  of  the  district.  Since  the  Exchanges  are  the  result 
and  not  the  cause  of  the  special  districts  in  which  they  are  lo- 
cated, we  must  look  back  of  them  to  find  the  causes  for  the  loca- 
tion of  various  utilities.     For  example,  the  leather  district  in 


84 


PRINCIPLES    OF    CITY    LAND    VALUES. 


New  York,  was  located  in  Beekman  Swamp,  on  account  of  the 
wet  ground  suitable  for  tanning  pits,  and  similarly  in  Philadel- 
phia, the  leather  district  was  located  on  both  sides  of  Dock 
Creek.  There  were  banks  on  Wall  Street  long  before  the  Stock 
Exchange  was  established,  the  location  of  the  banks  and  of  the 
United  States  Sub-Treasury  and  Assay  Office  attracting  the 
Stock  Exchange,  which  in  turn  drew  further  Banks,  Trust  Com- 
panies and  Brokers.  The  location  of  the  Cotton  Exchange  apart 
from  the  dry-goods  district  would  seem  strange  except  for  the 


Cost  of  excavating  high  bank  has  made  a  break  in  business  build- 
ings on  traffic  street.  First  floor  of  new  building  shown  excavated 
60  feet  back,  which  upper  stories  run  120  feet  back.  First  Avenue, 
Seattle. 


fact  that  thirty  or  forty  years  ago  Hanover  Square  was  the  cen- 
tre of  the  dry-goods  trade. 

The  reasons  for  the  clustering  together  of  wholesale  houses 
are  not  so  clear  as  in  the  case  of  retail  shops,  except  that  the 
features  which  are  favorable  for  one  wholesale  house  are  equally 
so  for  another,  such  as  proximity  to  transportation  facilities  to 
save  trucking,  and  the  fact  that  by  locating  together  they  attract 
more  out-of-town  buyers  than  if  scattered. 

The  outward  pressure  of  one  zone  upon  another  involves  the 


DISTRIBUTION    OF    UTILITIES. 


85 


slow  advance  of  the  banking  and  oflace  section  into  the  older  re- 
tail or  wholesale  districts,  the  continual  following  along  of  the 
lighter  wholesale  houses  into  the  buildings  vacated  by  the  re- 
tail shops,  the  close  pursuit  of  the  best  residence  sections  by  the 
best  retail  shops,  with  normally  a  mixed  zone  of  institutions, 
&c.,  acting  as  a  buffer  between  them,  and  the  steady  march  of 
residences  into  the  outlying  country,  first  utilized  for  gardens  or 
cottages.  Whatever  the  size  or  shape  of  a  city,  the  order  of  de- 
pendence of  one  district  upon  another  remains  the  same,  al- 


Frontage   on   traffic   street   used    for   advertising   purposes.     Seattle. 

though  many  districts  are  not  clearly  defined  but  overlap  others 
of  different  character. 

In  connection  with  the  progression  of  districts  in  a  city,  W3 
may  note  the  movement  of  the  point  of  highest  value,  which 
means  the  most  desirable  location  for  a  retail  shop  in  all  cities, 
except  in  the  few  financial  capitals  where  the  banking  and  ofiice 
district  produces  higher  values  than  retail  shops. 

In  a  waterfront  city  the  highest  values  start  at  the  point  of 
ongin  and  spread  normally  along  the  first  street  on  the  water- 


PRINCIPLES    OF    CITY    LAND    VALUES. 


Berlin.  The  clustering  of  railroad  stations  towards  the  city 
center  Illustrates  the  efforts  of  railroads,  for  strategic  reasons,  to 
reach  the  business  heart  of  the  city.  This  map  shows  only  a  small 
part  of  the  city. 


DISTRIBUTION    OF    UTILITIES.  87 

front,  moving  later  to  the  next  street  parallel  to  "it,  and  so  on 
back. 

The  rate  of  this  backward  growth  from  street  to  street  varies 
according  to  the  prosperity  of  a  city,  a  rapid  increase  of  popula- 
tion being  reflected  in  an  expansion  of  the  city's  area,  and  often 
a  rapid  shifting  of  the  business  centre.  In  slow  growing  cities  it 
may  take  from  twenty  to  forty  years  to  move  the  principal  re- 
tail business  from  one  street  to  another,  as  note  the  movement 
from  Water  Street  to  Main  Street  in  Bridgeport;  from  Bay 
Street  to  Congress  Street  and  later  Broughton  Street  in  Sav- 
annah, &c. 

If  the  principal  street  runs  at  right  angles  to  the  water  front, 
the  shifting  of  the  highest  point  of  value  takes  place  much 
more  rapidly  than  if  the  street  is  parallel  to  the  water  front, 
where  it  has  to  be  moved  laterally.  The  rate  instead  of  averag- 
ing from  twenty  to  forty  years  might  vary  from  eight  to  twelve 
years  per  block,  the  length  of  the  blocks  affecting  the  movement. 
One  factor  delaying  such  movement  would  be  a  strong  traffic 
street  at  right  angles  to  the  principal  street,  which  might  hold 
the  highest  values  at  its  intersection  for  many  years.  Such 
strong  cross  streets  often  produce  jumps  in  the  onward  move- 
ment of  the  highest  values,  as  with  14th,  23d,  34th  and  42d  streets 
in  New  York. 

The  rate  of  movement  of  cities  is  sometimes  affected  by  the 
destruction  of  whole  districts  by  fire,  which  brings  up  the  ques- 
tion to  owners  whether  or  not  to  rebuild  the  same,  type  of  build- 
ings on  the  same  locations.  In  many  cases  a  conflagration  causes 
the  erection  of  handsome  new  buildings  in  place  of  the  oM  ones, 
so  that  a  new  period  of  higher  utility  arises.  On  the  other  hand, 
the  destruction  of  individual  buildings  by  fire  will  have  an  un- 
favorable effect  if  tenants  move  elsewhere  and  owners  do  not 
rebuild. 

The  unfolding  of  a  city,  with  its  change  in  land  utilization 
shows  normally  in  the  case  of  any  lot  a  slow  increase  in  value 
up  to  a  high  point,  after  which  a  gradual  decline  takes  place, 
with  occasional  fluctuations  varying  the  main  movement.  Thus 
where  good  residences  take  the  place  of  small  suburban  homes, 
a  higher  utility  supplants  the  lower,  and  when  these  good  resi- 
dences become  old-fashioned  and  are  converted  into  boarding 
houses,  a  drop  in  value  will  ordinarily  occur.  This  is  sometimes 
offset  by  the  more  intense  utilization  of  the  land,  a  larger  rent 
being  earned  from  more  people  even  at  lower  rates.  Moreover, 
property  of  this  class  having  the  prospect  of  being  overtaken  by 
business  buildings  has  an  anticipated  value  in  advance  of  its 
yield.    When  retail  stores  arrive  and  become  firmly  established 


S«  PRINCIPLES    OF    CITY    LANB    VALUES. 

the  high  level  of  value  is  usually  reached,  this  period  lasting 
possibly  thirty  to  sixty  years.  As  the  retail  stores  move  on  a 
lower  utility  succeeds — and  usually  a  lower  value  unless  the 
city's  increase  in  population,  more  than  offsets  the  drop  in  util- 
ity— wholesale  houses  being  followed  by  storage  warehouses, 
cheap  tenements,  dilapidations,  &c.,  until  sometimes  land  for- 
merly the  best  in  the  city  becomes  so  remote  from  the  active 
business  centre  as  to  have  little  or  no  value. 


CHAPTER  VII. 

Currents  of  TravcL 

Regularity  of  daily  travel  the  basis  of  its  effect  on  city  struc- 
ture.—Chief  daily  movements  between  resicence  c.ni  business. 
—Shopping  habits  of  various  classes.— Retail  stores  chiefly 
located  by  currents  of  travel.— Change  of  axis  of  city  traffic. 
—Fluidity  of  daily  travel.— Street  railroads,  elevated,  under- 
ground, bridges,  ferries,  etc. 

The  life  of  a  city  involves  continual  travel,  day  and  night, 
throughout  its  entire  area,  the  most  notable  feature  of  which, 
and  the  basis  of  its  effect  on  the  city's  structure,  is  its  regular- 
ity. The  inhabitants  of  a  city  do  not  intermingle  at  random, 
but  go  from  one  place  to  another  by  the  quickest,  shortest,  or 
most  agreeable  route.  For  example,  in  New  York  many  thou- 
sands of  the  upper  classes  have  never  been  west  of  Sixth  Ave- 
nue or  east  of  Third  Avenue,  except  to  the  ferries,  and  many 
thousands  on  the  lower  east  side  have  never  seen  Fifth  Avenue, 
while  in  New  Orleans,  many  Creoles  have  never  crossed  Canal 
Street  into  the  American  quarter. 

The  chief  daily  movements  consist  of  the  journeys  of  business 
men  between  their  residences  and  their  places  of  business,  the 
complex  interweaving  of  these  men  within  the  business  centre 
and  the  shorter  trips  of  workmen  between  their  homes  and  their 
workshops. 

In  modern  cities  the  main  currents  of  business  men's  travel 
are  carried  by  street  railroads,  so  that  the  travel  consists  of 
short  trips  on  foot  converging  to  the  street  railroads,  a  long 
trip  in  the  cars  to  the  business  centre  and  there  short  trips  on 
foot  again.  In  some  cities  where  there  are  hills  between  the 
business  and  residence  sections,  the  currents  of  foot  travel  follow 
a  zigzag  course  up  and  down  the  hill,  it  being  easier  to  turn  cor- 
ners than  encounter  grades.  A  variation  may  occur  in  the  re- 
turn trip  where  men  stop  at  clubs,  cafes  or  hotel  lobbies,  the  lo- 
cation of  these  favorite  haunts  causing  a  different  route  to  be 
taken,  with  some  resulting  influence  on  values. 

Within  the  business  districts  occur  the  continual  interchange 
of  visits,  by  means  of  which  the  business  of  the  city  is  accom- 
plished. Here,  although  the  trips  are  short,  the  necessity  for 
saving  time  leads  to  the  gathering  together  of  the  various  forms 
of  business  in  special  districts.    In  large  cities  the  daily  trips  of 


90  PRIN-CIPLBS    OF    CITY    LAND    VALUES. 

workmen  are  made  chiefly  on  foot  and  are  widely  diffused 
throughout  the  tenement  districts,  with  small  effect  except  that 
certain  more  convenient  streets  attract  cheap  shops. 

The  daily  trips  of  women  are  made  either  for  shopping,  call- 
ing or  driving.  Here,  as  in  men's  trips,  the  travel  consists  of 
short  trips  on  foot  to  the  street  car  lines,  which  carry  the  con- 
centrated travel  to  the  largest  shops,  where  the  cars  are  left  and 
the  women  walk  to  the  other  shops.  For  the  same  reason  of 
convenience  women's  shops  are  crowded  together  in  order  to 
save  time  in  going  among  them. 

The  display  of  goods  is  vital  for  shops,  and  in  order  to  display 
goods  shade  is  necessary;  hence  the  side  of  the  street  which  is 
shady  during  the  part  of  the  day  in  which  women  shop  is  nor- 
mally worth  from  20  per  cent,  to  40  per  cent,  and  occasionally 
100  per  cent,  more  than  the  sunny  side  of  the  street.  The  west 
side  of  streets  running  north  and  south,  and  the  south  side  of 
streets  running  east  and  west,  are  shady  the  greater  part  of  the 
year  from  about  12  or  1  o'clock  on,  permitting  a  display  of  goods 
without  fear  of  fading,  and  rendering  the  sidewalk  agreeable. 
The  greater  part  of  the  purchasing  in  the  large  shops  is  done  by 
women  of  the  middle  classes,  whose  household  duties  prevent 
them  from  reaching  the  shops  until  after  11  o'clock.  The  busiest 
shopping  hours  are  from  11  o'clock  to  4  o'clock,  many  women 
taking  lunch  either  in  the  department  stores  or  in  restaurants 
nearby.  The  women  of  wealth  shop  usually  in  the  morning  be- 
itween  11  and  2  o'clock,  so  that  even  in  their  case  the  west 
or  south  side  of  the  street  has  some  advantage  of 
shade.  In  southern  cities  where  shade  is  even  more  im- 
portant, the  relative  value  of  the  four  corners  of  two 
intersecting  business  streets  is  well  defined,  the  southwest  cor- 
ner being  the  most  valuable,  the  southeast  next,  the 
northwest  next,  and  finally  the  northeast  corner.  This  refers 
only  to  retail  shopping  fronts,  the  corners  having  a  different  or- 
der of  preference  if  desired  for  other  purposes,  such  as  hotels  or 
office  buildings.  It  is  said  that  in  such  northern  latitudes  as  those 
of  St.  Petersburg  and  Montreal  the  sunny  side  of  the  street  is 
more  valuable  than  the  shady  side,  since  it  attracts  the  travel  In 
the  long  winters.  In  New  York  some  difference  can  be  noted  in 
the  tides  of  foot  travel  according  to  the  time  of  year,  but  since 
for  eight  or  nine  months  of  the  year  the  climate  is  mild,  the 
shops  become  established  on  the  shady  side  of  the  street  and 
whatever  travel  in  winter  changes  to  the  sunny  side  is  not  suf- 
ficient to  draw  them  over. 

Other  factors  are  sometimes  strong  enough  to  overcome  the 
advantage  of  shade,  such  as  proximity  to  a  section  of  customers, 


CURRENTS  OF  TRAVEL. 


91 


as  in  New  York  on  Sixth  Avenue,  between  34tli  and  59th  Streets, 
where  the  east  side  of  the  street  is  more  valuable  than  che  west 
side. 

In  the  larger  cities  the  general  use  of  private  carriages  by 
wealthy  women  influences  values,  in  that  the  high  grade 
women's  shops  seek  locations  away  from  car  lines  and  easily  ac- 
cessible to  the  "carriage  trade."  Such  locations  are  usually  on  or 
near  the  most  fashionable  axial  streets,  such  as  Fifth  Avenue  in 


Map  of  Baltimore,  showing  street  railroad  lines,  which  illustrate 
the  gathering  of  traffic  to  the  business  center  and  its  interchange 
on  intersecting  lines. 


New  York,  Michigan  Avenue  in  Chicago,  and  Boylston  Street 
in  Boston,  all  of  which  were  fashionable  driving  streets  long  be- 
fore the  residences  facing  them  were  driven  out  by  shops. 

The  daily  shopping  of  women  clerks,  shop  girls,  &c.,  is  done 
either  at  small  stores  in  the  neighborhood  where  they  live  or  at 
the  large  department  stores,  to  which  they  make  a  special  trip, 
lower  prices  being  more  important  to  them  than  the  time  con- 
sumed. 


92  PRINCIPLES    OF    CITY    LAND    VALUES. 

The  travel  of  mechanics  and  laborers  in  the  morning  is  hurried 
bv  their  having  to  report  at  the  workshops  at  a  certain  hour,  but 
ii  the  evening  they  have  a  chance  to  shop  in  the  small  stores  on 
the  way  from  the  factory  to  their  homes.  Ordinarily,  the  time  of 
workmen  and  their  wives  is  so  much  occupied  during  the  week 
that  the  bulk  of  their  shopping  is  done  on  Saturday  nights  from 
6  to  10  o'clock,  on  the  traffic  streets  which  pierce  the  tenement 
districts. 

In  the  smaller  cities  there  are  so  few  strangers  that  their  in- 
fluence may  be  disregarded.  In  the  large  cities  there  is  an  im- 
portant and  continuous  visiting  population,  which  varies  daily 
as  to  individuals.  The  average  number  of  strangers  in  New 
York  is  estimated  at  100,000  people,  who  support  many  of  the 
theatres,  shops,  and  hotels,  the  latter  being  important  as  the 
starting  points  from  which  the  visitors  trips  originate. 

In  the  smaller  cities  suburbanites  are  few  in  number,  and 
reaching  the  business  centre  chiefly  in  electric  cars  merge  with 
the  general  population  and  may  be  disregarded.  In  the  large 
cities  suburbanites  arrive  by  ferry  or  train  and  usually  make 
hurried  trips  to  their  offices  in  the  morning  and  back  in  the 
evening.  This  effort  to  reduce  the  time  between  their  homes  and 
iheir  business  militates  against  their  purchases  en  route,  with  the 
exception  of  small  articles  which  can  be  carried,  such  as  fruit, 
books,  flowers,  furnishing  goods,  &c.,  shops  for  which  locate 
around  some  of  the  ferries  and  railroad  depots.  An  extreme 
example  of  a  large  current  of  daily  foot  travel  of  the  highest  eco- 
nomic quality  is  furnished  by  the  summer  travel  on  Rector 
Street,  New  York,  where  thousands  of  wealthy  men  walk  daily 
from  the  Wall  Street  section  to  and  from  the  Sandy  Hook  boat 
Here  every  factor  is  favorable  to  promoting  an  increase  of 
values,  except  the  speed  with  which  the  walking  is  done  and  the 
fact  that  the  traffic  lasts  only  five  months  of  the  year,  which 
causes  it  to  have  no  influence  on  values. 

Added  to  the  daily  travel  in  a  city  is  the  evening  travel  to  the 
theatres,  opera,  music  halls,  &c.  The  theatres,  usually  en  street 
car  lines  and  near  the  most  important  hotels,  chiefly  attract  the 
evening  travel,  which  in  turn  draws  restaurants,  saloons,  cigar 
shops,  candy  shops,  soda  water  fountains,  florist  shops,  &c.  The 
variations  between  summer  and  winter  business  become  more 
marked  the  higher  the  social  class,  the  little  shops  on  the  lower 
east  side  of  New  York  probably  selling  an  equal  amount  of  goods 
throughout  the  year,  the  shops  supplying  the  wants  of  the  mid- 
dle classes  falling  off  during  the  hot  summer  months,  and  the 
season  for  fashionable  shops  lasting  about  flve  months.  The 
competitors  of  the  fashionable  New  York  shops  are  the  shops 


CURRENTS  OP  TRAVEL.  93 

at  Newport,  Lenox,  Bar  Harbor,  and  those  of  Paris  and  London, 
and  the  competitors  of  the  next  grade  of  shops  are  those  of  the 
summer  resorts  of  New  Jersey,  Long  Island,  or  near  New  York. 
Tradesmen  in  many  cases  meet  this  condition  by  having  winter 
stces  in  New  Yorli  and  summer  stores  where  their  patrons  go. 
In  so  far  as  retail  purchases  are  made  outside  of  New  York,  the 
earning  power  and  value  of  retail  property  in  New  York  is  low- 
ered, this  varying  in  proportion  to  the  length  of  the  summer 
absence. 

The  main  effect  of  daily  currents  of  travel  is  on  the  location 
of  retail  stores,  increasing  traffic  being  certain  ultimately  to 
change  any  street  into  a  shopping  street.  As  a  corollary  to  this 
is  the  important  fact  that  the  relocation  of  the  best  residence 
districts  is  certain  to  change  the  axis  of  the  principal  travel 
within  the  city,  which  will  draw  the  shops  and  values  to  new 
streets.  Such  changes  of  axis  have  taken  place  in  New  York 
from  Pearl  Street  to  Broadway,  and  from  streets  parallel  to  the 
river  front  to  streets  at  right  angles  to  it  in  St.  Louis,  St.  Joseph, 
Minneapolis,  and  are  now  taking  place  in  Toledo,  Portland,  Ore., 
and  Cincinnati.  As  shops  follow  the  shifting  currents  of  travel, 
rentals  move  with  them,  the  value  of  retail  land  depending  on 
the  number  of  people  passing,  qualified  by  their  purchasing 
power,  the  causes  which  bring  them  past  the  property  and  their 
method  of  locomotion.  This  dependence  of  retail  business  on 
daily  trafiic  is  due  to  the  operation  of  the  laws  of  chance,  by 
which  of  a  given  number  of  passers-by  a  certain  proportion  will 
become  customers. 

The  mention  of  traffic  within  a  city  suggests  the  double*  func- 
tion of  a  city  street  as  contrasted  with  the  single  function  of  a 
country  road.  A  country  road  is  a  means  of  communication 
only,  while  a  city  street  also  furnishes  frontage  for  buildings. 
Ordinarily,  city  streets  are  first  a  means  of  communication  and' 
later  furnish  frontage  for  buildings,  but  in  waterfront  cities  this 
may  be  reversed.  The  principal  business  streets  usually  have 
some  definite  point  of  origin,  such  as  a  ferry  or  a  railroad  sta- 
tion within  a  city,  or  a  country  town  or  district  outside  of  it,  and 
long  distance  or  through  traffic  is  a  prime  essential  for  business 
streets,  those  which  are  cut  off  at  one  or  both  ends  being  almost 
useless  for  retail  business,  even  though  immediately  contiguous 
to  main  arteries  of  traffic.  Currents  of  traffic  are  not  always 
straight,  but  may  follow  a  street  which  has  turns  or  angles,  or  a 
short  street  cut  through  a  block  between  two  main  business 
streets,  as  with  New  Bond  Street  in  London,  and  Union  Street 
in  Nashville.  A  serious  detriment  to  values  is  caused  by  a  break 
in  the  continuity  of  shops,  whether  due  to  a  vacant  lot,  a  church, 


94  PRINCIPLES    OF    CITY    LAND    VALUES. 

a  private  residence,  or  an  institution  of  any  kind.  A  row  of 
stores  resembles  a  chain,  the  insertion  of  a  vacancy  or  of  any 
different  utilization  breaking  its  cohesion. 

Besides  the  main  currents  of  travel,  the  little  feeding  streams 
are  closely  watched,  such  shops  as  hatters,  tailors,  lunch 
rooms,  men's  furnishing  goods,  etc.,  locating  in  the  men's  dis- 
trict near  the  oflSce  buildings.  The  grade  of  shops  on  the  streets 
leading  from  the  office  sections  conforms  to  the  character  of  the 
passers-by,  high-class  shops  being  where  employers  pass,  and 
cheaper  shops  where  clerks  go,  while  push-carts  and  hawkers 
catch  the  office  boy  trade. 

A  noteworthy  qualification  in  the  location  of  retail  shops  is 
that  the  larger  and  more  expensive  the  articles  to  be  purchased 
the  further  people  will  go  in  search  of  them.  Large  and  well 
managed  shops  will  attract  purchasers  wherever  located,  but 
even  such  shops  are  extremely  sensitive  to  the  merits  of  differ- 
ent locations  and  pay  high  rents  to  be  exactly  where  they  can 
obtain  the  largest  number  of  customers.  In  all  cities  there  are 
constant  changes  in  the  population,  and  all  shops  to  be  most 
successful  must  keep  themselves  before  the  public  by  means  of 
prominent  locations. 

The  most  striking  feature  of  the  daily  travel  within  a  city 
is  its  fluidity,  or  the  closeness  within  which  it  seeks  its  own 
level.  Obstructions  check  it  and  turn  it  aside  as  they  would  a 
stream  of  water.  In  flowing  down  a  street  it  backs  up  each 
cross  street,  carrying  stores  to  a  distance  proportionate  to  the 
strength  of  the  current;  and  where  two  currents  meet  the  pres- 
sure at  the  intersection  intensifies  the  back  currents.  The 
stronger  the  current  the  further  it  spreads  back  or  the  greater 
the  depth  of  shops,  in  some  cases  running  through  the  block,  as 
on  23d  Street,  New  York,  where  the  shops  extend  to  22d  Street 
on  one  side  and  24th  Street  on  the  other.  Similarly,  the  stronger 
the  current  of  traffic  the  higher  it  is  heaped  up,  or  the  taller  the 
buildings  to  accommodate  it.  The  current  of  travel  blocked  by 
Washington  Square,  New  York,  flowed  up  Broadway  and  6th 
Avenue  and  meeting  at  23d  Street,  a  back  current  of  business 
building  has  flowed  down  5th  Avenue,  in  the  same  way  that  a 
stream  meeting  a  rock  divides,  the  pressure  of  water  causing  a 
current  to  flow  back  to  the  rock. 

Street  railroads  have  wrought  a  revolution  in  the  structure  of 
cities,  scattering  population  over  a  wide  area,  adding  value  to 
the  circumference  by  rendering  it  accessible  for  residences,  and 
to  the  center  by  concentrating  traflEic  within  it,  a  part  of  this 
added  value  being  removed  from  the  intermediate  zone.  By 
rendering  new  districts  acessible,  thus  increasing  the  area     of 


CURRENTS  OF  TRAVEL.  95 

supply  of  land,  the  value  of  all  competititve  land  is  reduced,  so 
tliat  the  effect  of  street  railroads  on  residence  land  is 
to  lower  its  average  value.  The  speed  of  an  electric  car  is  so 
great  that  the  tendency  is  not  to  add  on  gradually  to  existing 
residence  sections,  but  to  project  beyond  them  into  the  cheap 
country  land.  Ordinarily,  capitalistic  handling  takes  hold  of  a 
new  outlying  district  and  by  laying  out  fine  streets  and  side- 
walks, sewers,  water,  gas,  electric  light,  etc.,  and  erecting  high- 
class  houses,  establishes  a  residence  section  of  higher  values 
than  much  of  the  residence  land  nearer  the  business  center.  Op- 
posed to  this  condition  are  the  two  factors  of  long  settlement, 
which  makes  old  residents  reluctant  to  move,  and  the  cost  of 
car  fares  amounting  to  between  $5  and  $10  per  month  according 
to  the  size  of  the  family,  which  operate  in  favor  of  the  old  fash- 
ioned residence  sections  near  the  business  center. 

It  may  happen  that  the  best  business  street  in  a  city  has  no 
car  line  on  it,  as  for  example  Nicollet  Avenue  in  Minneapolis; 
6th  Street  in  St.  Paul,  and  Felix  Street  in  St.  Joseph,  these  being 
for  this  reason  better  adapted  to  the  "carriage  trade."  An  ex- 
ample of  the  effect  of  street  railroads  on  carriage  trade  oc- 
curred in  New  York  when  the  construction  of  the  electric  roads 
on  Broadway  and  23d  Street  produced  such  a  dangerous  inter- 
section that  ladies  were  timid  about  driving  across  it.  This 
hastened  the  northward  movement  of  high-class  shops  from 
Broadway  below  23d  Street  to  5th  Avenue  above  25th  Street. 

Transfer  points,  owing  to  concentration  of  daily  streams  of 
people  and  consequent  opportunity  for  shops,  are  strategic  points 
in  a  city's  area,  creating  business  sub-centers,  whose  prospects 
of  increasing  values  are  limited  only  hy  the  number  and  quality 
of  the  people  likely  to  utilize  them.  As  examples,  note  the 
marked  effect  of  transfers  in  New  York  at  Broadway  and  34th 
Street,  Madison  Avenue  and  59th  Street,  Lexington  Avenue  and 
59th  Street;  also  in  New  Haven  at  Chapel  and  Church  Streets; 
in  Denver  at  15th  and  Lawrence  Streets,  and  the  many  transfer 
points  in  the  outlying  districts  of  Chicago. 

The  success  of  street  railroads  in  running  cars  to  the  top  of 
fairly  high  hills  has  added  millions  of  dollars  of  value  to  the 
higher  lands  in  all  hilly  cities,  as  in  San  Francisco,  Seattle, 
Peoria,  etc.  Similarly,  every  improvement  in  the  construction, 
operation  or  service  of  street  railroads  strengthens  their  in- 
fluence on  the  structure  of  cities.  In  general,  if  a  city  has  less 
than  the  normal  street  railroad  mileage  the  result  is  a  number 
of  small  business  sub-centers  in  outlying  districts,  and  a  con- 
sequent irregular  diffusion  of  values,  while   a  well  developed 


/ 


96  PRINCIPLES    OF    CITY    LAND    VALUES. 

street  railroad  system  renders  stable  the  normal  distribution  of 
values. 

In  the  largest  cities  the  elevated  railroads  have  the  same  gen- 
eral effects  as  the  electric  street  railroads,  with  the  additional 
influence  of  removing  value  from  between  the  stations  and  in- 
creasing it  at  the  stations.  Despite  the  heavy  damages  paid  by 
the  elevated  roads  in  New  York,  it  is  doubtful  if  they  have  in- 
jured many  properties.  It  is  certainly  noteworthy  that  over 
50  per  cent,  of  the  property  owners  affected  did  not  claim 
damages  from  the  elevated  roads,  also  that  the  regular  scale  of 
damages  paid  out  of  court  is  only  $10  per  front  foot.  One  bene- 
ficial result  of  the  elevated  road  between  stations  is  in  affording 
shopkeepers  along  the  route  an  opportunity  to  display  advertis- 
ing signs  and  goods  on  the  upper  floors.  Where  the  elevated  sta- 
tions are  only  five  blocks  apart,  as  on  the  6th  Avenue  line  in  the 
shopping  district  from  14th  to  23d  Streets,  no  building  being 
more  than  600  feet  from  an  elevated  station,  the  crowds  from  the 
different  stations  intermingle,  so  that  all  stores  on  the  short 
stretches  between  the  stations  are  benefited  by  the  travel. 

Where  stations  are  ten  blocks  apart  there  is  no  such  overlap- 
ping of  streams  of  travel,  but  if  there  were  sufficient  travel  to 
demand  it  there  would  be  additional  stations,  in  which  case  the 
beneficial  effects  of  the  elevated  would  be  intensified  and  the 
detrimental  effects  diminished,  so  that  it  might  be  said  to  be  the 
fault  of  the  property  that  it  has  not  sufficient  business  strength 
to  make  an  elevated  road  a  source  of  additional  value  rather 
than  the  reverse.  While  an  elevated  road  is  always  detrimental 
in  a  residence  section,  and  partly  detrimental  and  partly  helpful 
in  a  small  business  section,  in  the  most  patronized  retail  shop- 
ping sections  it  is  a  strong  advantage. 

The  infiuence  of  an  underground  road  is  similar  to  that  of  the 
elevated,  except  that  the  feature  of  advertising  is  absent.  The 
longer  haul  of  an  underground  road  creates  residence  values  at 
still  greater  distances,  and  also  still  further  intensifies  values  at 
the  center  of  the  city  and  at  all  stations,  especially  express 
stations. 

Bridges,  ferries  and  tunnels,  which  serve  as  additional  outlets 
to  a  city,  co-operate  with  long  distance  transportation  facilities, 
and  any  change  in  their  location  or  any  competition  of  new 
bridges  or  tunnels  by  changing  traffic  routes  cause  marked 
shifting  of  values.  Thus  the  construction  of  the  Brooklyn 
Bridge  by  diverting  traffic  from  the  old  Fulton  Street  ferry,  and 
throwing  it  half  a  mile  back  from  the  river  on  either  side,  re- 
moved millions  of  dollars  of  value  from  the  streets  leading  to 
the  ferries,  especially  in  Brooklyn. 


CHAPTER  VIII. 

Types  of  Buildings. 

Suitability  to  location.— Proportion  of  cost  of  building  to 
value  of  land.— Effects  of  skyscrapers.— Table  of  business 
buildings  suitable  for  various  locations.— Table  of  residences 
suitable  for  various  locations.— Depreciation  and  life  of  build- 
ings.— General  effects  of  buildings. — Nuisances  and  restrictions. 

Let  us  consider  next  the  types  of  buildings  erected  for  differ- 
ent utilities  and  their  reflex  effects  on  values.  The  most  im- 
portant consideration  governing  suitability  to  location  is  that 
of  proportion  of  cost  of  building  to  value  of  land,  the  safe  gen- 
eral rule  being  that  the  cost  of  the  building  should  approxi- 
mately equal  the  value  of  the  land.  In  other  words,  the  typical 
successful  property,  land  and  building,  appears  to  earn 
double  interest  on  the  cost  of  the  building,  one-half  of 
which  capitalized  as  economic  rent  gives  a  value  to  the  land 
equal  to  the  cost  of  the  building.  While  there  are  excep- 
tions to  this  proportion  it  forms  a  median  line  of  de- 
parture, applying  most  closely  to  business  property,  whether 
the  building  is  a  $5,000  one-story  brick  on  a  cheap 
lot  or  a  $3,000,000  office  building  in  the  highest  priced  loca- 
tion. The  chief  destruction  of  capital  comes  from  the 
erection  of  expensive  buildings  on  cheap  lots,  while  the  erection 
of  cheap  buildings,  known  as  tax  payers,  even  on  expensive  land, 
should  not  lead  to  loss,  although  it  may  not  lead  to  great  profit. 
On  a  street  whose  traffic  is  increasing  rapidly  a  business 
building  costing  several  times  the  value  of  the  land  may 
profitably  be  erected,  since  within  ten  years  the  value  of  the  land 
may  overtake  the  cost  of  the  building.  If,  however,  the  building 
runs  at  a  low  return  for  ten  years,  the  investment  may  prove 
a  poor  one,  and  the  compromise  of  erecting  one  or  two-stories 
of  sufficient  strength  to  carry  later  five  or  six,  is  sometimes  the 
best  solution. 

In  the  largest  cities  increasing  demand  for  space  in  favored 
localities  has  steadily  increased  the  height  of  buildings,  the 
practical  checks  arising  from  time  to  time  having  been  suc- 
cessively overcome  by  new  inventions.  While  fifty  years  ago 
the  average  height  of  business  buildings  in  New  York  was  three 
or  four  stories,  and  in  the  best  locations  five  or  six  stories,  the 
general  use  of  elevators  after  1870  ran  the  height  up  to  eight 

8 


98 


PRINCIPLES    OF    CITY    LAND    VALUES. 


The  economic  error  here  consists  of  placing  ornamental  columns 
In  front  of  the  oflaces  on  either  side  of  the  entrance — especially  the 
column  on  each  end — causing  vacancies  and  low  rents,  representing 
an  average  loss  of  probably  4%  on  $200,000.  The  entrance  to  a 
large  and  important  building  should  be  duly  emphasized,  but  such 
sacrifice  of  income  is  unnecessary.  Broadway  and  Leonard  Street, 
New  York. 


or  nine  stories,  where  it  was  checked  by  the  expense  of  the 
heavy  walls  and  by  the  waste  of  the  most  valuable  space  on  the 
ground  floor  taken  up  by  the  walls.  Skeleton  steel  construction, 
developed  since  1890,  has  saved  the  space  on  the  ground  floor, 
modified  the  cost  of  the  highest  buildings  and  run  them  up  to 


TYPES   OF  BUILDINGS.  99 

twelve  or  sixteen  stories,  which  express  elevators  have  lifted  to 
twenty-five  and  thirty  stories. 
When    skyscrapers    were    first   erected    it   was    the    common 


Chamber  of  Commerce,  Duluth.  Badly  planned  front;  over  60% 
of  frontage  wasted  on  stone  masonry  and  entrances,  leaving  less 
than  40%  to  earn  ground  floor  rentals.  Building  has  been  financially 
unsuccessful. 


opinion  that  buildings  of  this  character  in  the  midst  of  low  build- 
ings bycuttingoff  their  light  and  air  robbed  them  of  their  rights, 
so  that  justice  demanded  a  legal  limit  to  the  height  of  build- 
ings.   It  was  soon  found  out,  however,  that  where  a  skyscraper 


100 


PRINCIPLES    OF    CITY    LAND    VALUES. 


was  SO  built  as  to  require  light  and  air  from  the  adjoining  lot, 
it  was  the  owner  of  the  small  lot  who  had  the  skyscraper  at  his 
mercy.  The  threat  of  replacing  the  low  building  with  a  high 
one,  destroying  the  value  of  possibly  a  quarter  to  a  third  of  the 
skyscraper,  has  quite  uniformly  compelled  the  owner  of  the  sky- 
scraper to  buy  or  lease  for  a  long  term  of  years  the  adjoining 
property,  as  with  the  American  Surety  Building,  Washington 


Chamber  of  Commerce,  Cincinnati;  designed  by  H.  H.  Richardson. 
A  magnificent  building,  but  with  Income  from  ground  floor  subor- 
dinated to  the  architectural  design. 


Life  building,  etc.  Skyscrapers  being  naturally  located  on  cor- 
ners, the  typical  development  of  a  small  block  would  consist  of 
four  high  buildings  on  the  four  corners  and  four  low  ones  be- 
tween them  controlled  by  the  high  ones.  With  long  narrow 
blocks,  as  in  New  York,  the  development  would  be  more  irregu- 
lar, the  tendency  being  to  alternate  high  and  low  buildings. 
Further  variations  occur  where  a  skyscraper  owns  one  or  two 
lots  in  an  adjoining  tract  in  ordor  to  block  the  erection  of  an- 


TYPES   OF   BUlLDlN&S'.'  '  '      '>'''''''  >*101 

Other  high  building,  as  with  the  Park  Row  Realty  Building,  and 
the  Broad  Exchange  Building,  or  the  purchase  of  low  buildings 
across  narrow  streets  to  insure  light  and  air,  as  with  some  of 
the  life  insurance  company  buildings. 

The  height  of  buildings  has  been  limited  by  statute  in  Boston 
and  Chicago,  and  attempts  have  been  made  to  do  so  in  New 
York,  but  the  general  sentiment  seems  to  be  that  the  economic 
check  is  sufficient. 

When  skyscrapers  were  new,  rents  diminished  from  the 
ground  floor  up,  as  in  older  buildings,  but  the  upper  stories 
being  more  desirable  on  account  of  better  light  and  air  and 
freedom  from  noise  and  dust,  the  rents  were  soon  equalized. 
The  demand  for  the  upper  stories  has  continued,  so  that  in  some 


y 


Planned  for  a  bank  building.  The  solid  wall  of  stone  and  brick 
ten  feet  high  throws  away  the  ground  floor  frontage,  from  which  the 
chief  income   should  be   obtained.     Berlin   Building,    Tacoma. 

buildings  higher  rents  are  charged  for  them,  the  least  desirable 
floors  being  from  the  third  to  the  sixth,  this  less  productive 
stratum  furnishing  an  economic  check  to  the  height  of  buildings. 
Wherever  modern  office  buildings  have  been  erected,  the  ad- 
vantages they  offer  have  drawn  tenants  from  the  dark  and  old- 
fashioned  buildings  surrounding  them.  The  offset  to  owners 
from  this  destruction  of  capital  in  old  buildings  by  modern  im- 
provements, is  the  increase  in  the  value  of  the  land  due  to  the 
possibility  of  similarly  improving  their  land.  Old  property  two 
or  three  blocks  away,  however,  may  lose  its  tenants  without  any 
-dorresponding  gain  in  values,  since  the  increase  in  space  sup- 
t)lied  by  the  skyscraper  is  so  great  that  its  district  is  more 
limited.  As  illustrating  the  increase  of  floor  space  from  high 
buildings,  the  Bowling  Green  Building  increased  the  floor  space 


io^ 


'  PilIN^C!lf>L^   b^    CITY    LAND    VALUES. 


on  the  same  area  from  80,000  to  567,000  square  feet,  and  the  Grer- 
man-American  Building  from  26,000  to  126,000  square  feet.  An 
example  of  a  shrinking  office  district  was  offered  by  lower  Wall 
Street,  where  of  late  years  buildings  have  been  vacant  owing 
to  the  completion  of  the  new  buildings  around  the  banking 
center  at  the  intersection  of  Wall  and  Nassau  Streets.  As  the 
office  district  spreads  the  old  locations  regain  value,  and  lower 
Wall  Street  is  now  building  up  with  skyscrapers.  Similarly  the 
old  three  and  four-story  buildings  on  lower  Broadway  became 
unremunerative  and  some  were  closed  up,  until  the  Bowling 
Green  Building  with  its  modern  facilities  attracted  tenants.  The 
concentration  of  the  office  district  caused  by  skyscrapers  results 
in  a  great  saving  of  time  in  the  interchange  of  business,  and 
hence  an  economic  gain  to  the  community. 

Subject  to  limitations  from  changing  conditions  and  local  cir- 
cumstances in  different  cities,  the  following  table  is  an  estimate 
of  the  character  of  business  buildings,  as  to  cost,  height  and 
material,  which  may  suitably  be  erected  on  land  of  varying 
values: 


On  land 

valued 

per  front  foot. 

$200 

300 

500 

800 

1,000 

1,500 

^     2,000 

3.000 

6,000 

15.000 

18,000-35.000 


Buildings  may 

cost  per  cubic 

foot  about: 

8  to  10  cents 

8  to  10  cents 

8  to  10  cents 

12  to  20  cents 

12  to  20  cents 

12  to  20  cents 

18  to  25  cents 

18  to  25  cents 

30  to  50  cents 

30  to  50  cents 

30  to  50  cents 


Construction 

of  build- 
ings may  be: 
Ordinary  brick 
Ordinary  brick 
Ordinary  brick 
Ordinary  brick 
SlowbAirning 
Slowburning 
Tending  to  fireproof 
Tending  to  fireproof 
Skeleton  steel,  fireproof 
Skeleton  steel,  fireproof 
Skeleton  steel,  fireproof 


Height 
of  build- 
ings may  be: 

2  story 

3  story 

4  story 

5  story 

6  story 
6  story 

9  story 
.  vw  9  story 
10  to  12  Btory 
12  to  20  story 
20  to  30  story 


3  to 

4  to 

5  to 
5  to 

7  to 
7  to 


Turning  to  residences,  the  proportion  of  cost  of  building  may 
vary  from  one  and  a  half  to  three  times  the  value  of  the  land, 
except  as  to  workmen's  cottages,  where  it  may  vary  from  three 
to  five  times  the  value  of  the  land.  The  highest  grade  houses 
are  ordinarily  built  for  homes  and  cost  more  than  they  will  sell 
for  or  than  their  rentals  will  pay  interest  on,  this  lack  of  com- 
mercial value  increasing  with  the  cost  of  the  house.  In  expen- 
sive houses  in  smaller  cities  there  is  a  tendency  towards  restor- 
ing the  equilibrium  between  the  value  of  the  land  and  buildings 
by  placing  them  on  plots  of  100  to  150  feet  front  by  200  to  400 
feet  deep.  This  equilibrium  is  more  apparent  than  real,  since 
not  over  75  feet  of  frontage  is  necessary  for  the  house,  the  bal- 
ance of  the  land  being  a  luxury  on  which  taxes  are  paid  and  in- 
terest lost.  In  all  cases  the  cost  of  the  house  should  be  closely 
proportioned  to  the  cost  of  the  surrounding  houses — a  |50,000 


TYPES   OF   BUILDINGS. 


103 


house  in  the  midst  of  $5,000  houses,  or  a  $5,000  house  in  the  midst 
of  $1,000  houses,  having  a  commercial  value  but  little  in  excess 
of  the  cheaper  neighboring  houses.  Instances  could  be  cited  of 
houses  costing  five  times  as  much  as  the  surrounding  houses 
which  have  not  sold  for  as  much  as  th©  cheaper  ones,  because 
rich  people  will  not  live  among  cheap  houses,  and  poor  people 


The  error  consists  in  placing  entrance  to  three-story  building  on 
principal  street  instead  of  side  street.  These  16  feet  would  have 
yielded  from  $1,500  to  $2,500  per  annum  for  the  past  ten  years,  or 
6%  on  $25,000  to  $40,000.  The  error  has  been  partly  remedied  by 
blocking  the  entrance  with  a  cigar  stand,  yielding  $720  per  annum. 
Second  and  Cherry  Streets,  Seattle. 


i/ 


cannot  afford  to  keep  up  large  houses.  Such  houses  usually  sell 
for  boarding-houses  or  sanitoriums.  On  the  other  hand,  a  small 
h'ouse  in  the  midst  of  expensive  ones  will  usually  sell  and  rent 
well,  there  being  strong  competition  to  obtain  a  residence 
location  of  social  importance  at  small  outlay.  There  is,  how- 
ever, a  limit  to  the  erection  of  cheap  residences  in  good  locations. 


104 


PRINCIPLES    OF    CITY    LAND    VALUES. 


Front  of  corner  store  in  Duluth.  About  as  badly  planned  as  possible. 


a  large  number  of  them  spoiling  the  value  of  locations  otherwise 
suitable  for  handsome  residences,  and  some  houses  in  fashion- 
able sections  being  too  small  to  sell  well. 
Turning  to  the  larger  cities,  houses  built  in  blocks  represent 


TYPES   OF   BUILDINGS. 


lOo 


a  pressure  of  population  on  land,  which  does  not  permit  the  use 
of  land  for  light  and  air  around  detached  houses.  In  this  class  of 
residences  the  cost  of  the  house  should  not  greatly  exceed  the 
value  of  the  land,  with  a  general  tendency,  where  the  land  is 
cheap,  of  the  cost  of  the  houses  exceeding  the  land  value,  and 
where  the  land  is  expensive,  the  cost  of  the  houses  being  less  than 
the  land  value.  A  still  more  intense  pressure  of  population  on  land 


Income  from  corner  about  50%  of  what  it  should  be,  due  to  error 
of  architect,  who  aimed  at  a  massive  appearance.  Morrison  and 
Sixth  Streets,   Portland,   Ore. 


results  in  apartment  houses,  which  may  properly  vary  in  cost 
from  two  to  four  times  the  value  of  the  land.  Where  apartment 
hpuses  are  built  in  smaller  cities,  especially  if  they  are  large  and 
expensive,  they  anticipate  a  pressure  on  land  which  has  not 
yet  arrived,  and  are  apt  to  be  unsuccessful.  Such  apartment 
houses  sometimes  cost  ten  to  fifteen  times  the  value  of  the  land, 
the  danger  of  such  a  top-heavy  investment  being  the  abundance 


106 


PRINCIPLES    OF    CITY    LAND    VALUES. 


of  competing  land  which  can  be  cheaply  obtained,  and  the  fact 
that  almost  the  entire  investment  is  in  the  building,  which  is 
certain  to  depreciate  physically.  For  example,  where  a  $50,000 
apartment  house  has  been  erected  on  $5,000  of  land,  assuming  in 
10  years  a  30%  depreciation  of  the  building,  or  $15,000,  and  a  30% 
appreciation  of  the  land,  or  $1,500,  the  net  capital  loss  would  be 
$13,500.  The  mistake  of  all  owners  who  erect  expensive  build- 
ings on  cheap  land  is  in  not  realizing  that  buildings  erected  to 


Equally  massive,  but  steps  omitted.  Rents  sacrificed.  The  dealer 
in  sewing  machines  and  bicycles  can  only  exhibit  six  bottles  of  oil 
in  each  window  to  attract  customers.  Morrison  and  Seventh 
Streets,  Portland,  Ore. 


rent  do  not  dominate  their  environment.  The  advantage  of  an 
even  division  of  investment  between  land  and  building  3«  clear, 
in  that  as  against  the  certain  physical  depreciation  of  the  build- 
ing there  may  be  an  appreciation  of  the  land  to  offset  it.  Where 
tall  apartment  houses  are  erected  on  the  corners  of  the  traffic 
streets  they  injure  the  value  of  the  adjacent  lots  on  the  side 
streets,  despite  their  acting  as  buffers  to  the  noise  and  dust  of 
the  traffic  streets. 
With  limitations,  the  following  is  an  estimate  of  the  charae- 


TYPES   OF  BUILDINGS.  107 

ter  of  residences  as  to  cost,  size  and  construction,  which  may 
suitably  be  erected  on  land  of  varying  values: 

On  land  Av'ge  Residences  may  cost. 

valued  front-  , » » 

per  age  of     Construction  may  be.  Per 

front  ft.  lot.                                                   cu.  ft.       < Total » 

$5  in  smaller  cities     25  Frame  detached $5  to  $7       $400  to       $800 

10"         "  "        25  "             "          5"     7         800"       1,000 

20"         "  "        30  "             "          5"     8      1,500"       2,000 

30"        "  "        40  "      or   brick    6"    9     2,500"      3,000 

40' 40  "  "          7  "  10      3,000"       4,000 

50  "         "  "         50  Brick,              detached  8  "  12      4,500  "       6,000 

75  "         "  "         60  "       or  stone    "  10  "  15      6,000  "     10,000 

100'"         "  "    60—100  "        "       "       "  U  "  18   10,000"    20,000 

150  "         "  "    60—100  "        "       "        "  15  "  20    12,000  "     30,000 

250  "         "  "     75—150  "        '  15  "  25    15,000  "     50,000 

500  "    largest  "     12—16  Brick  or  stone  block  10  "  15      6,000  "     15,000 

750 16-20  "         "       "  "  12  "  18    10,000  "     20,000 

1,000  "         "  "     20-25  • •  15  "  20    20,000  "     50,000 

2,000  "         "  "     20—80  "         "       "          •*  18  "  25    40,000  "     60,000 

3.000"         "  "     25—40  Fireproof    30  up.     100,000  "  150,000 

5,000"         "  "     30—50  "           40"        200,000  "  400,000 

7,500-9,000"  "    40-100  "          50  "        500.000  up. 

One  feature  affecting  the  suitability  of  buildings  to  land  is 
that  of  the  life  of  buildings.  The  useful  life  of  a  building  may 
be  ended  from  any  one  of  four  causes:  Physical  decay,  destruc- 
tion by  fire,  change  of  utility,  or  competition  of  new  buildings.. 

The  physical  decay  of  ordinary  buildings  depends  more  on  re- 
pairs than  on  the  character  of  the  original  materials  used.  Steel 
frame  buildings  are  of  such  recent  invention  that  their  life  has 
not  yet  been  tested,  but  engineers  estimate  that  they  will  last 
several  hundred  years. 

An  estimate  of  the  physical  depreciation  of  buildings  if  kept  in 
repair  would  be  as  follows: 

Life  in  Annual 

Class  of  building.                                   years.  depreciation. 

Cheap   frame  tenements 10  to    15  5  to  10% 

Ordinary  frame  residences 25  to    30  2  to    3% 

Cheap  brick  tenements  and  office  buildings .   25  to    30  2  to    3% 

Cheap  brick  or  stone  residences 35  to    50  1  to    2  % 

Better  class  frame  residences 35  to    50  1  to    2% 

"          "       brick  and  stone  residences 50  to    75  1  to    V/2% 

Good  brick  and  stone  office  buildings 75  to  100  1% 

Steel    skeleton    buildings Unknown.  .... 

The  loss  from  a  change  of  utility  is  modified  by  the  greater  or 
less  convertibility  of  business  buildings,  many  office  buildings 
being  convertible  into  hotels  or  lodgings.  Thus  the  old  Astor 
House  was  changed  into  an  office  building  twenty  or  thirty  years 
ago,  but  was  reconverted  into  a  hotel,  and  there  are  many  in- 
stances in  western  cities  of  buildings  used  interconvertlbly  for 
lodgings  or  offices.  The  destruction  of  buildings  from  change  of 
utility  constitutes  an  offset  to  increased  value  in  land,  in  that 
the  more  rapid  the  increase  in  land  value,  the  more  rapid  the 


108 


PRINCIPLES    OF    CITY    LAND    VALUES. 


destruction  of  value  in  the  building.  In  locations  of  rapidly 
changing  utility,  old  buildings  are  generally  considered  to  be  of 
no  value.  The  correct  basis  of  their  value,  however,  would  be 
the  amount  of  gross  rents  they  will  earn  before  being  removed, 
less  such  expenses  as  are  due  to  their  still  standing,  such  as 
insurance,  repairs,  taxes  on  the  building  only,  etc.  From  this 
standpoint    the  great  number    of  old  buildings    are  generally 


Type   of   blocked   entrance   with   more   than  50%    of   frontage    taken 
up  by  obstructions.    Royal  Street,  Mobile. 


undervalued,  since  the  process  of  replacing  them  is  certain  to  be 
a  gradual  one. 

Competition  of  new  buildings  operates  more  strongly  in  the 
case  of  residences  and  office  buildings  than  of  retail  shopping 
buildings.  As  to  residences,  for  example,  when  the  public  has 
been  educated  to  prefer  light  stone  or  brick  renaissance  houses 
to  the  old-fashioned  brownstone  front,  and  modern  interior 
arrangements,     decoration    and    plumbing     to    former     styles 


TYPES   OF   BUILDINGS. 


103 


A  repelling  approach  to  a  store.    Liberty  Street,  near  William 
Street,   New  York. 


and  equipment,  the  value  of  the  old  house  has  about  departed, 
even  though  it  is  in  good  physical  condition.  As  to  shops,  the 
location  is  paramount,  and  tenants  pay  high  rents  for  the  ground 
floor  with  little  regard  to  the  architectural  appearance  of  the 
building  above. 

The  natural  tendency  to  erect   continually   better   and   hand- 
somer buildings  is  an  added  force   drawing  retail  shops  onward 


110  PRINCIPLES    OF    CITY    LAND    VALUES. 


How  to  carry  on  business  behind  a  granite  quarry  is  the  problem 
confronting  the  prospective  tenant.  A  common  error  of  architects 
is  to  sacrifice  income  from  store  frontage  to  "solidity"  of  construc- 
tion. Jersey  Central  Building.  Liberty  and  Washington  Streets, 
New  York. 


into  new  locations.  Thus,  while  the  best  business  street  in  an 
old  city  has  usually  been  built  up  with  brick  houses  two  or  three 
stories  high  and  converted  into  shops  on  the  ground  floor,  the 
buildings  on  the  next  business  street  are  larger  and  better  built, 
and  so  on  until  the  best  section  is  reached.    Sometimes  the  best 


TYPES   OF   BUILDINGS. 


Ill 


buildings  when  new  are  rented  for  less  than  the  old  ones,  but 
as  tenants  are  attracted  the  pressure  of  demand  causes  rents  to 
advance  in  the  new  buildings,  while  removals  cause  rents  to 
drop  in  the  old  ones.  When  the  rents  in  the  new  buildings  are 
the  highest  in  the  city  the  shifting  of  the  shop  centre  and  point 
of  highest  value  has  been  accomplished.  Efforts  are  sometimes 
made  to  bring  back  tenants  to  the  old  buildings  by  improving 
them,  but  rarely  succeed,  because  the  onward  movement  is  too 
strong  to  be  overcome,  and  because  the  efforts  are  usually  made 


Corner  store  on  Nicollet  Avenue,  Minneapolis.  Removing  brick 
work  to  permit  more  show  windows.  A  not  uncommon  recon- 
struction. 


too  late  and  without  co-operation  among  the  owners  of  the  de- 
clining street.  The  owners  of  property  yielding  the  highest 
rents  in  the  city  usually  anticipate  nothing  but  continued  in- 
crease of  rents  and  seldom  realize  that  the  business  centre  of  a 
ci_^  can  shift,  until  declining  rents  bring  this  fact  forcibly  to 
their  attention.  Even  then  many  of  them  have  not  the  courage 
or  enterprise  to  tear  down  their  old  buildings  and  erect  hand- 
some new  ones,  and  others  are  financially  unable  to  do  so,  it  be- 
ing more  difficult  to  obtain  building  loans  on  a  declining  street 
than  on  an  improving  street. 


112  PRINCIPLES    OF    CITY    LAND    VALUES. 

To  take  up  the  general  effects  of  the  erection  of  buildings,  these 
may  either  increase,  diminish  or  have  no  effect  upon  the  value  of 
the  land  covered  and  the  surrounding  land.  The  hypothesis  of 
absence  of  effect  may  be  eliminated,  since  while  the  selling  price 
of  a  lot  may  not  be  affected,  some  effect  on  the  surroundings  will 
surely  result.  The  first  principle  is  that  if  the  building  is  suited 
to  the  needs  of  the  location  and  is  equal  to  or  superior  in  con- 
struction, arrangement  and  appearance  to  existing  buildings,  it 


Good  and  bad  store  fronts.  The  store  on  street  level  with  good 
windows  yields  about  25%  more  rent  than  the  adjoining  one.  Madi- 
son Street,  Toledo. 


tends  to  increase  values,  while  if  inferior  and  cheaper  than  ex- 
isting buildings  it  tends  to  depress  them.  Such  an  effect  of  in- 
ferior buildings  is  by  no  means  uniform,  as  there  are  locations 
in  which  the  erection  of  any  building,  however  poor,  increases 
values. 

The  effects  of  buildings  differ  chiefly  according  to  whether  they 
are  erected  in  a  built  up  section  within  a  city,  or  in  new  terri- 
tory on  its  outskirts.  If  erected  in  a  built-up  section,  old  build- 
ings are  removed  to  make  place  for  the  new  ones,  public  atten- 


TYI'ES   OF    BUILDINGS. 


113 


The  five-frot  fTId  on  th°  comer,  yipldin'^  a  l-^r^e  income  for  a 
saloon  and  advertising,  illustrates  the  high  value  of  a  good  location, 
even  though  the  area  is  small.     Broadway,  New  York. 


tion  is  attracted  to  the  locality  and  the  prices  of  surrounding 
land  stiffen.  The  new  buildings  are  quite  certain  to  draw  some 
tenants  from  the  older  surrounding  buildings,  so  that  their  rents 
and  value  will  diminish,  while  the  land  being  suitable  for  better 
buildings  will  increase  in  value. 

The  building  of  new  residences  in  long-established  residence 
sections  tends  to  increase  values,  public  opinion  being  apt  to  con- 


114 


PRINCIPLiES    OF    CITY    LAND    VALUES. 


cede  a  new  lease  of  life  for  i>ossibly  thirty  or  forty  years  to  the 
old  residence  district. 

When  buildings  are  erected  on  the  outskirts  of  a  city  where 
the  conversion  from  agricultural  land  to  building  land  is  taking 
place,  the  character  of  the  buildings  will  at  first  determine  the 
value  of  the  land.  Such  districts  afford  highly  competitive  sites, 
where  the  only  difference  between  lots,  barring  topography,  is  in 
transportation  facilities,  so  that  building  operators  can  control 
values  in  the  new  territory  by  their  scale  of  development,  as  in 
South  Brooklyn.  This  is  always  assuming  that  the  speculative 
buildings  shall  be  utilized  at  a  normal  return  on  the  capital  in- 


Good  planning  of  light  well  used  for  stores.    Augusta,   ua. 


vested,  which  is  begging  the  whole  question.  It  is  the  business 
of  building  operators  to  know  what  class  of  people  can  be  at- 
tracted to  the  new  areas,  and  their  success  or  failure  in  moving 
population  to  occupy  the  new  houses,  and  in  attracting  various 
classes  of  people,  determines  the  scale  of  values.  From  the  stand- 
point that  land  has  no  value  until  there  is  demand  for  its  utili- 
zation, there  is  a  theoretical  gain  in  transforming  speculative  or 
anticipated  value  into  actual  value,  but  the  future  of  all  outlying 
land  is  discounted  many  years  ahead,  so  that  prices  may  drop  after 
development.  The  worst  that  can  happen  to  a  suburban  tract  is 


TYPES  OF  BUILDINGS. 


115 


that  it  should  be  forced  on  the  market  before  there  is  a  demand 
for  it,  the  result  being  that  poor  people  attracted  by  low  prices, 
will  build  cheap  houses  there  and  create  a  shabby  and  repulsive 
district,  which,  if  large  enough,  may  act  as  a  bar  to  the  city's 
growth  in  that  direction.  There  are  many  cases,  of  course, 
where  such  occupancy  is  but  temporary,  as  with  the  shanty  set- 


IL.  *''*' 

1;     ^               IF 

fc^^^^^ " 

Good  store  front.    Wide  and  low  windows.     Piers  covered  by  show- 
cases.    Summit  Street,  Toledo. 


tlements  on  the  upper  west  side  in  New  York,  and  the  negro 
ownership  on  residence  streets  in  Washington. 

Whether  within  or  without  a  city,  much  can  be  done  to  force 
value  into  land  by  the  erection  of  handsome  buildings,  if  done  on 
a  large  scale.  It  is  true  that  tenants  seeking  accommodations 
are  compelled  to  take  them  where  they  exist,  except  that  if  good 
tenants  want  buildings  erected  on  new  sites  they  can  always 
secure  them,  capital  being  easily  found  where  income  is  assured. 
This  vital  limitation  to  a  hypothetical  monopoly  of    existing 


116 


PRINCIPLES    OF    CITY    LAND    VALUES. 


buildings  demonstrates  again  the  fact  that  it  is  effective  'lemand 
and  not  buildings  which  creates  values. 

The  building  which  is  most  suitable  to  its  location  may  be 
defined  as  that  one  which  will  for  the  longest  term  of  years  yield 
the  largest  and  most  certain  net  return.  The  time  element  in 
this  definition  eliminates  such  buildings  as  a  factory  in  a  resi- 
dence district,  or  a  saloon  in  a  business  location,  which  while 


Good  store  front.     Great  width  between  piers.    Low  show  windows 
with  prism  glass  above.     Summit  Street,   Toledo. 


yielding  a  large  rent  injures  the  surrounding  property.  There 
are  cases  in  rapidly  changing  sections  where  the  most  suitable 
building  is  one  some  years  in  advance  of  the  time,  since  the  util- 
ity of  the  building  yielding  the  highest  present  rent  will  in  a  few 
years  disappear,  necessitating  its  destruction  or  reconstruction. 
Many  such  cases  of  discounting  the  future,  though  carefully  rea- 
soned, have  resulted  unsuccessfully,  owing  either,  to  the  direc- 
tion of  growth  or,  equally  important,  the  rate  of  growth,  being 


TYPES   OF   BUILDINGS. 


117 


misjudged.  The  community  feels  its  way  along  a  few  buildings 
at  a  time  in  one  direction  or  another,  watching  carefully  where 
anticipated  demand  Is  not  realized  and  unsuccessful  buildings 
point  a  warning.  The  main  principle  seems  to  be  that  the  best 
neighbors  any  building  can  have  are  buildings  similar  to  itself, 
business  buildings  and  residences  being  most  keenly  responsive 


Recessed  front  with  piers  utilized  for  show  cases.     A  good  plan  for 
so  narrow  a  street  as  Nassau  Street,  New  York. 


to  environment,  and  public  buildings,  factories,  churches,  hos- 
pitals, transportation  terminals,  etc.,  being  more  independent. 

Before  outlining  the  normal  yield  and  resulting  land  values  of 
the  various  utilities,  we  may  note  that  the  chief  variation  in 
them  is  in  the  form  of  deductions  due  to  nuisances,  under  which 
name  w«  may  class  anything  tending  to  depreciate  the  value  of 
land.    The  character  of  nuisances  varies  according  to  the  section 


118 


PRINCIPLES    OF    CITY    LAND    VALUES. 


in  which  they  are  located,  the  cheaper  the  property  the  more  im- 
pregnable to  attack,  and  the  more  expensive  the  property  the 
more  sensitive  to  the  levelling  power  of  proximity,  the  ten- 
dency of  all  adjoining  buildings  being  to  strike  a  mean. 

To  classify  nuisances,  those  affecting  retail  business  property 
are  adjoining  vacancies,  whether  caused  by  rebuilding,  fire, 
removals  or  failures,  low  class  neighbors  such  as  saloons,  dilapi- 
dations, whether  of  buildings,  sidewalks  or  surroundings,  and 
topographical  faults,  such  as  sharp  variations  of  grade,  under- 
ground streams  or  quicksands.  One  of  the  most  serious  draw- 


Example    of   converted    building.    Old   style   residence    altered   Into 
stores.     Denver. 


backs  which  could  happen  to  business  buildings  would  be  the 
construction  of  a  viaduct  carrying  all  the  traffic  past  them  at  an 
elevation,  as  with  the  8th  Street  viaduct  in  Kansas  City  and  the 
High  Holborn  Viaduct  in  London,  the  latter  being  constructed  to 
avoid  the  blocking  of  traffic  at  the  intersection  of  Oxford  and 
Farringdon's  Streets.  In  office  sections  the  chief  nuisance  to  tall 
buildings  consists  of  their  being  crowded  so  close  together  as  to 
cut  off  light  and  air  from  each  other.  Apart  from  this,  sky- 
scrapers remote  from  the  earth's  surface  have  but  little  to  fear, 
unless  it  be  the  chimney  of  adjoining  lower  buildings,  which  can 


TYPES   OF  BUILDINGS. 


119 


be  compelled  to  run  up  higher  if  the  smoke  is  objectionable. 
Temporary  nuisances,  however,  may  arise  at  the  ground  level, 
such  as  streets  torn  up  for  repairs,  the  laying  of  pipes,  etc.,  or 
sidewalks  blocked  while  an  adjacent  building  is  being  erected. 

Residences  are  more  easily  affected  than  business  property,  al- 
though values  are  lower,  in  that  the  erection  of  almost  any  build- 
ing other  than  a  residence,  constitutes  a  nuisance.  For  example, 
all  kinds  of  factories,  even  those  which  emit  neither  smell  nor 


Change  of  utilization  of  building.    Church  converted  to  stores  and 
offices   on   desirable    retail    street.    Madison   Street,    Toledo,    O. 


noise;  power-houses  of  street  railroads;  hospitals,  largely  for 
fear  of  infection;  public  schools,  on  account  of  the  noise  made 
by  the  scholars;  business  buildings,  hotels  or  apartment  houses, 
on  account  of  their  taking  away  light,  air  and  quiet  from  the  ad- 
joining property;  low  lands,  owing  to  fear  of  malaria — ^and  all 
cheap,  old  and  dilapidated  buildings  constitute  nuisances.  All 
rough  and  rocky  land,  or  a  steep  grade  with  bluffs,  hollows, 
standing  pools  or  ponds,  is  undesirable,  unless  the  unsightliness 


120 


PRINCIPLES    OF    CITY    LAND    VALUES. 


has  been  taken  away  by  conversion  into  small  parks.  Stables 
constitute  the  most  common  nuisance  to  residences  in  New  York, 
a  "stable  street"  having  a  greatly  diminished  value,  as  for  exam- 
ple, lots  on  55th  Street,  west  of  5th  Avenue,  sold  for  about  half 
the  price  of  those  on  54th  Street,  and  lots  on  52d  Street,  east  of 
5th  Avenue,  about  two-thirds  the  price  of  those  on  51st  Street. 
Street  railroads,  which  in  the  smaller  cities  may  raise  residence 
values,  in  the  larger  cities  are  always  nuisances  on  residence 
streets,  one  certain  result  being  that  they  attract  shops,  and 


First  Presbyterian  Church  located  back  from  street.  With  growth 
of  retail  business  on  Fourth  Street  the  space  in  front  was  built  In 
with  stores  and  offices.  Entrance  to  church  through  building  shown 
by  sign.    Cincinnati. 

when  this  process  begins  the  desirability  of  the  street  for  resi- 
dence ends. 

An  elevated  railroad  renders  any  street  through  which  it  runs 
Impossible  for  residences,  while  steam  railroads  ordinarily  drive 
residences  a  block  or  two  away.  Where  a  railroad  runs  in  part 
or  in  whole  through  a  tunnel,  as  with  the  New  York  Central 
above  56th  Street,  the  injurious  effect  is  modified. 

Even  residences  are  a  nuisance  to  their  neighbors  if  they  oc- 
cupy an  abnormal  proportion  of  their  lot  area,  as  where  the  en- 
tire lot  is  covered  except  for  a  side  light  well. 


TYPES   OF   BUILDINGS. 


121 


So  many  and  so  severe  are  the  nuisances  to  residence  property 
that  many  residence  neighborhoods  are  controlled  by  restric- 
tions, usually  running  with  the  land,  but  sometimes  limited  in 
time.  In  the  smaller  cities  the  ordinary  restrictions  in  new  resi- 
dence sections  provide  that  the  premises  shall  be  occupied  for 
residence  purposes  exclusively,  that  no  residence  shall  be  erected 
costing  less  than  a  given  amount,  and  that  no  residence  shall  be 
placed  within  a  certain  distance  of  the  front  line  of  the  lots. 
Such  restrictions  greatly  enhance  values,  in  guaranteeing  pro- 


Change  of  utilization  of  building.     Church  converted  into   a  stable. 
Cheap   location,   not   suitable    for   retail   business.    Minneapolis. 

tection  against  cheap  buildings,  stores,  saloons,  etc.  In  New 
York  the  Murray  Hill  restriction  to  residences  is  well  known, 
this  having,  undoubtedly  helped  to  keep  stores  and  apartments 
iway  from  some  locations  on  Murray  Hill.  As  instancing  the 
value  of  a  restriction,  recently  on  53d  Street,  west  of  Fifth  Ave- 
nue, the  owner  of  the  only  two  lots  not  restricted  to  private  resi- 
dences, having  planned  an  apartment  house,  was  paid  |25,000  to 
restrict  them  to  private  residences.  The  chief  disadvantage  in  re- 
stricting land  to  certain  uses  is  that  the  utility  of  American  city 
land  changes  rapidly,  and  when  residence  property  should  be 
converted  to  stores  but  cannot  owing  to  restrictions,  a  serious 
detriment  to  values  occurs. 


CHAPTER  IX. 


Rentals  and  Capitalization  Rates* 

Basis  of  gross  business  rents,  what  the  property  earns  for  the 
tenant;  of  gross  residence  rents,  what  the  tenant  can  afford 
to  pay.— Deductions  from  gross  rents  in  properties  of  different 
character,  and  table  of  percentages. — Effects  on  net  rents  of 
fluctuations  in  gross  rents. — Capitalization  rates. 

While  gross  rents  are  fixed  by  competition,  the  question  arises 
how  do  bidders  determine  what  they  can  pay?  The  basis  differs 
radically  between  business  property  which  earns  income  for  the 


Example  of  misplaced  building.    Expensive  building  on  cheap  land. 
Foreclosed  and  sold  at  heavy  loss.    East  Portland,  Ore. 


occupant  as  well  as  the  owner,  and  residence  property,  which 
for  the  occupant  consumes  income  only. 

The  gross  rents  of  business  property  are  gauged  from  the  eco- 
nomic standpoint,  these  being  in  the  long  run  the  normal  propor- 
tion of  what  the  property  can  earn  for  the  tenant.  The  pro- 
portion of  gross  receipts  which  a  shopkeeper  pays  as  rent  varies 


RENTALS    AND    CAPITALIZATION    RATES. 


123 


according  to  his  ability  as  a  tradesman,  the  character  and  class 
of  his  business,  and  the  location,  a  fair  average  being  from 
20%  to  40%.  The  better  the  location  for  retail  trade  the  higher 
the  proportion  of  receipts  paid  for  rent.  For  retail  trade  the 
location  and  the  consequent  advertising  perform  the  vital  func- 
tion of  selling  the  goods,  and  the  shopkeeper  can  largely  devote 


No.  1.  Contrast  of  income  between  extravagant  and  cheap  build- 
ings. This  building,  which  cost  $396,000,  has  always  yielded,  in 
good  times  and  bad,  less  net  income  than  the  building  across  the 
street,  which  cost  under  $20,000.  This  due  both  to  bad  planning 
of  expensive  building  and  to  high  ratio  of  expenses,  50%  to  60% 
versus  15%  for  the  cheap  buildings.  Second  and  Cherry  Streets, 
Seattle.     (See  following  picture.) 

his  energies  to  selecting  what  the  people  want.  Similarly,  though 
in  a  less  marked  way,  prominent  office  buildings  help  to  adver- 
tise the  business  of  their  tenants.  On  the  other  hand,  mercan- 
tile property  not  on  traffic  streets,  wholesalers,  etc.,  pay  but  a 
small  proportion  of  their  receipts  as  rent,  the  saving,  however, 
going  to  the  hire  of  drummers  to  sell  goods. 


124 


PRINCIPLES    OF    CITY    LAND    VALUES. 


The  gross  rents  of  residences  represent  the  proportion  of  in- 
come which  various  classes  can  afford  to  pay  for  house  rent. 
While  the  return  for  such  expenditure  is  chiefly  the  satisfaction 
of  suitable  surroundings,  social  ambition  influences  all  classes  to 
live  in  the  best  neighborhoods  within  their  reach.  The  propor- 
tion of  rent  to  income  varies  from  15%  or  20%  among  the 
wealthy,  up  to  25%  or  35%  among  tenement  dwellers.    Taking  as 


No.  2.  Contrast  of  income  between  extravagant  and  cheap  build- 
ings. These  cheap  buildings  opposite  expensive  building  shown  in 
previous  picture: 

Cheap  Expensive 

buildings.  buildings. 

Gross  rents $19,600  $34,000 

Expenses    2,900  18,200 

Net  rents $16,700  $15,800 

Or  6%  on 278,000  263.000 

Deduct  building 20,000  396,000 

Property  earns  6%   net  on      ..$258,000       minus  $133,000 
In  other  words,  the  expensive  building  is  capital  wasted. 


RENTALS    AND    CAPITALIZATION    RATES. 


125 


gross  rents  the  amounts  actually  received  and  not  the  full  rental 
value,  from  which  an  allowanace  for  vacancies  must  be  made,  we 
may  note  first  the  great  difference  in  the  proportion  of  operating 
expenses  according  to  the  class  of  property,  this  varying  from 
10%  for  one  or  two  story  brick  store  buildings,  up  to  50%  for 
office  buildings  or  apartment  houses. 


Example  of  misplaced  building.  In  the  despression  of  1893- 
1898  this  building  did  not  quite  pay  expenses,  leaving  no  return  for 
the  land,  which  cost  $100,000,  or  for  the  building,  which  cost  $240,- 
000,  while  adjoining  one  and  three-story  buildings  on  less  valuable 
land,  covering  same  area,  paid  6%  net  on  value  of  building,  and  $600 
per  front  foot  for  the  land.  The  error  consisted  in  placing  bank  and 
office  building  in  small  retail  section.    Tester  Way,  Seattle. 

Explaining  this  difference  is  the  fact  that  in  office  buildings 
and  apartment  houses,  from  20%  to  25%  of  the  rent  represents 
the  payment  for  services,  such  as  light,  heat,  elevator,  janitors, 
cleaning,  &c.  If  from  gross  rentals  all  service  charges  are  de- 
ducted, the  other  charges,  taxes,  insurance,  repairs  and  rent  col- 
lecting, approximate  in  percentage  quite  closely  in  all  classes 
of  property. 


126 


PRINCIPLES    OF    CITY    LAND    VALUES. 


Example  of  misplaced  building.  Expensive  eleven-story  fireproof 
office  building  placed  about  150  feet  off  the  principal  street.  Has 
earned  from  2%  to  3%  net  per  annum  as  against  a  probable  5%  if 
on  the  best  street.  Land  60  feet  by  62  feet,  appraised  $25,500.  or 
$425  per  front  foot  for  half  depth.  Building,  $160,000.  Building 
costs  6%  times  the  land,  a  "top-heavy"  investment.  Columbus,  Ohio. 


Average  taxes  vary  somewhat  in  different  cities.  Taxes  on 
individual  properties  in  the  same  city  \ary  more  sharply  owing 
to  irregular  assessing  by  tax  officials.  Figuring  the  aver- 
age of  a  large  number  of  American  cities,  taxes  range  from  1^4% 
to  15^%  of  actual  value,  the  chief  exceptions  being  in  Washing- 


RENTALS    AND    CAPITALIZATION    RATES. 


127 


ton,  where  taxes  amount  to  6-10%  (the  U.  S.  government  paying 
half  the  taxes),  and  in  San  Francesco,  where  taxes  amount  to 
8-10%  (the  city  having  no  honded  debt).  The  chief  errors  of 
assessors  come  from  their  over-estimate  of  external  appearances 
and  from  the  habit  of  following  former  assessment  rolls,  so  that 
quite  uniformly  property  which  has  been  valuable  but  which  is 
deteriorating  is  assessed  higher  than  property  in  the  line  ot 
growth  and  yielding  larger  rents. 

The  cost  of  insurance  is  usually  so  slight  that  it  can  be  disre- 
garded in  making  up  the  budget  of  annual  expenses.  Rates 
range  from  .15c.  to  .30c.  per  $100  per  annum  for  first-class  risks 


'2.0 


10 


0.0 


Side  street  on  lower  level. 


fTeT7t*?<7  per  Tnotttf^ 


20. 


»>       '  Zl7     n 


10. 


\*4-00.     \*1Z5.    \*5ZS.  I 
pc-r    -{i'\o-riX\ti 

Rentals  on  traffic  street  $11,400  versus  $600  on  side  street,  or 
nearly  20  to  1.  This  illustrates  the  severe  drop  in  rentals  and 
values  off  from  a  traffic  street.  (In  the  present  instance  partly  due 
to  grade  on  side  street.)    Corner  Second  and  Marion  Streets,  Seattle. 


in  the  larger  cities,  .50c.  to  .75c.  per  $100  on  nrsi-ciass  risks  in 
the  smaller  cities,  $1.00  per  $100  on  stores  and  office  buildings  in 
the  smaller  cities,  and  so  on  up. 

Leases  vary  in  their  provisions  as  to  payment  for  repairs  by 
landlord  and  tenant,  but  if  paid  by  the  tenant  the  rent  is  pro- 
portionately reduced.  Average  repairs  vary  from  one-half  of  1% 
of  the  value  of  the  building  per  annum  in  the  case  of  the  high- 
est type  of  fireproof  buildings,  1%  for  ordinary  mercantile  build- 
ings, 2%  for  older  property  or  that  of  cheaper  construction,  3% 


128  PRINCIPLES    OF    CITY    LAND    VALUES. 

to  4%  for  old  tenements,  and  so  on  up  in  proportion  to  the  age, 
character  of  construction,  and  lack  of  care  of  the.  buildings. 

The  cost  of  rent  collecting  averages  from  2%%  to  3%  of  the 
rent  receipts  in  the  larger  cities,  according  to  the  class  of  prop- 
erty, and  about  5%  in  the  smaller  cities,  according  to  the  class 
of  property.  Owners  who  are  competent  to  manage  real  estate 
may  save  agents  commissions  by  so  doing,  but  instances  are  not 
uncommon,  especially  as  to  large  business  property,  where  own- 
ers managing  their  own  property  lose  their  time  and  from  20% 


Example  of  expensive  residence  wrongly  located  in  suburbs  of 
Indianapolis.  Later  surrounded  by  cheap  cottages.  Land  and  build- 
ing appraised  at  $48,000.  Mortgaged  for  $20,000.  Foreclosed  and 
sold  ten  years  later  for  $1,900. 

to  30%  of  the  income  which  an  expert  rental  agent  could  have 
obtained. 

An  estimated  scale  of  proportion  of  total  operating  expenses 
and  net  rents  would  be  as  follows,  the  cost  of  services  where 
rendered,  as  in  office  buildings,  apartments  and  some  tene- 
ments, being  included  in  expenses: 

Expenses.      Net  rents. 

Low  retail  or  wholesale  buildings 10-25%  90-75% 

Residences 20-30%  80-70% 

Non-elevator  office  buildings 25-35%  '^^-^^'^ 

Tenements,  non-elevator  and  elevator 25-45%  75-55% 

Elevator  apartments '   -10-55%  60-45% 

Fireproof  office  buildings 40-65%  60-45% 


RENTALS   AND   CAPITALIZATION   RATES.  129 

It  is  clear  that  the  lower  the  cost  of  the  building  in  proportion 
to  the  value  of  the  land,  the  nearer  the  income  approaches  to 
pure  ground  rent,  against  which  the  sole  charge  is  taxes.  On 
the  other  hand,  the  more  expensive  the  building  the  higher  the 
maintenance  cost,  owing  both  to  the  greater  number  of  services 
rendered  and  to  the  higher  standard  of  accommodation.  Since 
the  operating  expenses  of  a  building,  whether  fully  or  only 
partly  occupied,  vary  but  slightly,  the  larger  the  proportion  of 
expenses  to  gross  rentals  the  more  marked  will  be  the  rise  or 
fall  of  net  rentals  as  gross  rentals  fluctuate.  Ordinarily,  expen- 
sive office  buildings  are  properly  located,  the  chief  errors  being 
In  the  erection  of  expensive  buildings  in  small  cities,  or  in  poor 
locations  in  larger  cities.  When  hard  times  cause  a  sharp  drop 
in  rents  in  the  smaller  cities,  instances  have  been  known  of  the 
upper  floors  of  such  buildings  not  earning  sufficient  rent  to  pay 
for  the  mere  services  rendered,  so  that  it  would  pay  for  ownei^ 
to  close  the  buildings  above  the  groun4  floor,  even  though  the 
ground  floor  stores  are  in  active  demand.  The  danger  to  owners 
of  heavy  fixed  charges  is  shown  in  the  following  table: 


With 
percent- 
age of  ex-  If  gross    Then  net    If  gross    Then  net     If  gross    Then  net 
penses  to  rents  rise  rents  rise  rents  rise  rents  rise  rents  rise  rents  rise 
gross  inc. :    or  fall      or  fall.      or  fall      or  fall.      or  fall       or  fall. 

40% 


10% 
20% 
30% 
40% 
50% 
60% 


20%  22% 

20%  25% 

20%  29% 

20%  33% 

20%  40% 

20%  50% 


40% 

40% 
40% 
40% 


or  fall. 

or  fall 

44%     1 

60% 

50% 

56% 

60% 

60% 

66% 

80% 
100% 

60% 
60% 
60% 

^7o 
75% 
85% 
100% 
120% 
150% 


The  next  charge  against  gross  rents  is  for  interest  on  capital 
invested  in  the  building,  this  being  figured  at  the  same  rate  as 
the  capitalization  of  the  ground  rent,  after  an  allowance  for  de- 
preciation has  been  made. 

The  final  residuum  constitutes  the  economic  or  ground  rent, 
which  represents  the  competitive  premium  paid  for  location. 
Where  there  is  no  residuum  of  ground  rent  in  city  land  it  does 
not  follow  that  the  land  has  no  value,  but  usually  that  the  im- 
provements are  not  suitable,  so  that  the  value  must  be  esti- 
mated under  a  different  utilization.  If  the  improvement  is  a 
suitable  one,  absence  of  ground  rent  may  be  due  to  temporary 
drop  in  rentals  or  bad  management,  all  city  land  normally  yield- 
ing some  ground  rent. 

With  an  established  economic  rent,  the  sole  i  emaining  factor 
to  transform  this  into  intrinsic  value  is  the  rate  of  capitaliza- 

10 


130 


PRINCIPLES    OF    CITY    LAND    VALUES. 


toion.  As  capitalization  rates  vary  with  securities,  Government 
bonds  selling  below  a  2%  basis,  railroad  bonds  and  stocks  on  a 
31/^%  to  5%  basis,  and  industrials  on  a  7%  to  10%  basis,  so  the 
rates  of  capitalization  of  urban  rents  vary  from  4%  lor  the  high- 
est class  property  in  the  largest  cities,  to  5%  and  6%  for  second- 
class  property  in  the  same  cities,  or  for  first-class  property  in 
smaller  cities,  7%,  8%  and  10%  for  tenements  in  the  largest 
cities,  and  12%  to  15%  for  temporary  utilizations  or  disreputable 
purposes  in  the  smaller  cities.    The  great  power  of  capitalization 


Substantiai  buildings  from  which  rentals  and  value  iiave  departed. 
Land  and  building  would  sell  for  less  than  half  the  cost  of  the  build- 
ing.    Front   Street,   Portland,   Ore. 


rates  on  values  is  due  to  the  fact  that  for  every  change  of  1% 
in  the  rate  of  capitalization,  values  may  change  from  twelve  to 
twenty-five  times  the  difference  in  interest.  For  example,  a 
property  with  a  net  income  of  $10,000  would  sell  on  an  8%  basis 
at  $125,000,  on  a  6%  basis  at  $166,000,  and  on  a  4%  basis  at  $250,- 
000.  The  lower  the  capitalization  rate  the  greater  the  effect  of 
any  change  of  values:  For  example,  a  fall  from  8%  to  7%  adds 
but  14%  to  the  value  of  the  property,  while  a  fall  from  5%  to  4% 
adds  25%  to  the  value  of  the  property.  Moreover,  as  large  in- 
terest rates  apply  to  the  largest  properties  all  further  fractional 


RENTALS   AND   CAPITALIZATION    RATES. 


131 


Example  of  financial  history  of  real  estate.  Land  89  feet  by  99 
feet  on  south  corner  of  16th  and  Laurence  Streets,  Denver,  bought 
on  tax  title  many  years  ago  for  $500.  Leased  1890  for  $14,000 
ground  rent  net  per  annum  for  99  years,  or  5%  on  $280,000  =  $3,150 
per  front  foot.  Nine-story  and  basement  slow-burning  building 
erected  1890,  costing  $325,000.  Gross  rents  189i,  $35,200;  net 
rents  about  $17,500,  less  ground  rent  $14,000,  leaves  $3,500,  or  1% 
net  on  cost  of  building.  Leasehold  mortgaged  for  about  $75,000; 
rents  dropped,  building  surrendered  to  mortgagee  and  then  to 
groundowner,  who  acquired  thus  a  property  now  renting  well  and 
worth— land  and  building— about  $300,000  (not  $600,000,  as  at  one 
time  estimated),  for  an  original  outlay  of  $500. 


132  PRINCIPLES    OP    CITY    LAND    VALUES. 

lowering  of  low  interest  rates  results  in  an  enormous  mass  of 
values.  The  marked  difference  between  capitalization  rates  of 
high  class  and  low  class  property  in  the  same  city  indicates  the 
large  number  of  people  who  desire  to  own  high  class  property, 
and  the  few  who  desire  to  own  low  class  property.  The  reason 
foi'  such  preference  is  that  with  high  class  property,  rents  are 
more  stable  and  easily  collected,  the  property  is  more  quickly 
and  certainly  convertible,  it  can  be  mortgaged  at  a  lower  rate  of 
interest  and  for  a  larger  percentage  of  value,  the  buildings  de- 
preciate much  less  rapidly  and  the  prospects  of  increase  in  value 
are  better. 

That  land,  even  of  the  highest  type  and  in  the  largest  cities,  is 
a  slow  asset,  is  due  to  a  number  of  causes,  among  them  being 
the  fact  that  land  is  not  easily  passed  from  hand  to  hand  as  are 
stocks  and  bonds,  land  involves  personal  or  directly  deputed 
management,  where  stocks  and  bonds  do  not,  there  is  no  Ex- 
change with  daily  quotations  giving  the  values  of  land,  as  with 
stocks  and  bonds;  and  finally  the  value  of  land  is  Influenced  by 
many  complex  changing  factors,  whose  effects  are  differently 
estimated  by  different  people.  Because -land  is  a  slow  asset,  con- 
vertibility, or  certainty  and  speed  in  selling  it,  produces  a  high 
premium  for  the  best  property  by  lowering  its  capitalization  rate. 


CHAPTER  X. 

Scale  of  Average  Values. 

starting  with  no  value  in  city  site,  average  values  of  acreage 
on  outskirts,  mechanics'  residence  lots,  better  grades  of 
residence  lots  and  business  lots. — Tables  of  average  values 
for  best  business  and  best  residence  land  in  cities  of  different 
sizes  and  in  certain  selected  cities. 

Starting  from  the  condition  of  no  value  in  land  when  a  city 
originates,  let  us  consider  the  scale  of  average  values  of  resi- 
dence and  business  land  in  cities  of  various  sizes,  land  used  for 
other  purposes  being  omitted  as  being  more  of  an  individual 
problem. 

At  the  outer  circumference  of  cities  land  is  held  as  acreage,  the 
prices  per  acre  advancing  from  the  normal  value  of  farm  land 
near  cities,  $50  to  $150  per  acre,  up  to  market  garden  land,  which 
may  earn  interest  on  $300  to  $1,000  per  acre,  and,  finally,  to  spec- 
ulative tracts  held  at  $500  to  $5,000  per  acre,  whose  prices  are 
based  on  the  estimated  earnings  of  the  land  when  it  secures  the 
anticipated  utilization.  Since  the  proportion  of  land  occupied 
by  streets  averages  about  35% ,  the  conversion  of  acreage  into  lots 
means  a  loss  in  building  area  of  that  percentage,  so  that  with 
the  expenses  of  platting,  opening  streets,  taxes,  loss  of  interest, 
&c.,  it  is  generally  estimated  that  property  bought  by  the  acre 
must  sell  by  the  lot  for  double  the  acre  price  in  order  to  avoid 
loss  in  handling. 

The  cheapest  lots  in  any  city  are  those  utilized  for  workmen's 
houses,  varying  in  smaller  cities  from  $150  to  $300.  The  larger 
the  city  the  larger  the  number  of  well  paid  mechanics  and  the 
greater  the  effective  demand  for  lots.  A  mechanic's  lot  on  the 
outskirts  of  a  small  city  differs  from  one  on  the  outskirts  of  New 
York  not  only  in  price  but  in  size,  those  in  small  towns  having 
50  to  60  feet  frontage,  and  those  in  New  York  15  to  20  feet  front- 
age with  usually  two-family  houses  on  them.  Thus  an  average 
price  of  $150  for  50x100  foot  lots  in  small  cities  would  be 
equivalent  to  $1,300  per  net  acre  after  platting,  or  $850  per 
acre  as  acreage,  and  a  price  of  $300  for  15x100  foot  lots 
in  large  cities  would  be  equivalent  to  $7,700  per  net  acre  after 
platting,  or  $5,000  per  acre  as  acreage.  In  the  outskirts  of  the 
smaller  cities  platted  land  runs  as  low  as  $2  to  $4  per  front  foot, 
and  there  are  built  up  mechanics'  sections  with  street  car  ac- 


134 


PRINCIPLES    OF    CITY    LAND    VALUES. 


■WtSHlNSTOW  Af 


A_J"LJftl_. 


mHSJcnA^i  25  )  ( 2S  ]         1 25  1        1  25 


Council    Bluffs.    Business    section.    Figures   represent    value   of 
corners,  for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


SCALE  OF  AVERAGE  VALUES. 


135 


Salt  Lake  City.     Business  section.     Figures  represent  value  of  cor- 
ners, for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


ih=&=^ 


RAIi.KO/(0    TWACK3 


©ULUTM.. 


Duluth.    Business  section.     Figures  represent  value  of  corners,  for 
lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


136 


PRINCIPLES  OF  CITY  LAND  VALUES. 


Seattle,    Wash.    Business    section.    Figures    represent    value    of 
corners,  for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


SCALE  OF  AVERAGE  VALUES. 


137 


Atlanta,  Ga.    Business  section.    Figures  represent  value  of  corners, 
for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


138 


PRINCIPLES  OF  CITY  LAND  VALUES. 


Sorf*ioi>  fCLAim 


Toledo.    Business  section.    Figures  represent  value  of  corners,  for 
lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


SCALE  OF  AVERAGE  VALUES. 


139 


Columbus.    Business    section.    Figures    represent   value    of    corners 
for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


SCALE  OF  AVERAGE  VALUES. 


141 


commodation  less  tlian  a  mile  from  tlie  centre  of  cities  of  30,000 
population,  where  land  sells  at  but  $5  per  front  foot,  equival- 
ent to  5  cents  per  square  foot. 

From  this  figure,  land  for  detached  residences  grades  upwards 
more  in  proportion  to  the  class  of  people  utilizing  it  than  the 


WALNUT  GffflNO 


Kansas  City.    Business  section.     Figures  represent  value  of  corners, 
for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 

Size  of  the  city,  to  land  worth  $20  to  $30  per  front  foot  for  the 
residences  of  small  shopkeepeers  and  clerks,  and  $40  to  $75  for 
the  more  fashionable  residences  in  cities  of  75,000  population  and 
under.  Such  residence  property  would  have  good  street  car 
service,  graded  streets,  sidewalks,  sewer,  gas,  water,    electric 


142  PRINCIPLES    OF    CITY    LAND    VALUES. 

light,  etc.,  the  cost  of  which  may  vary  from  $5  to  $15  per  front 
foot. 

The  best  residence  land  in  cities  of  100,000  to  200,000  popula- 
tion runs  from  $75  to  $150  per  front  foot,  in  cities  of  200,000 
population  to  400,000  population  from  $300  to  $500  per  front  foot, 
and  in  New  York  from  $2,000  to  $5,000  per  front  foot  on  the  side 
streets  and  $6,000  to  $9,000  per  front  foot  on  Fifth  avenue. 
1  The  poorest  locations  utilized  for  shops  in  the  small  cities  are 
ordinarily  worth  from  $50  to  $75  per  front  foot,  from  which  point 
values  rise  to  an  average  of  $600  to  $800  per  front  foot  for  the 
best  business  property  in  cities  of  50,000  population,  about  $2,000 
per  front  foot  in  cities  of  200,000  population,  $10,000  in  cities  of 
2,000,000  population,  and  $15,000  to  $18,000  in  New  York.  Above 
these  levels,  land  in  the  financial  district  of  New  York  averages 
from  $15,000  to  $25,000  per  front  foot,  this  financial  district  hav- 
ing no  counterpart  in  any  other  American  city  and  being  due  to 
the  supremacy  of  New  York  as  a  financial  centre.  The  highest 
values  in  London  are  similarly  in  the  financial  district,  while  in 
Chicago  and  most  of  the  smaller  cities,  shopping  land,  owing  to 
the  large  amount  of  retail  business  and  small  amount  of  bank- 
ing, is  worth  about  twice  as  much  as  financial  land.  The  aver- 
age figures  given  represent  corner  lots  having  not  less  than 
2,500  square  feet,  $350  per  square  foot  (equal  to  $35,000  per  front 
foot)  having  been  paid  thirty  years  ago  for  two  small  comers  at 
Wall  and  Broad  Streets,  and  recently  for  a  small  corner  at  Broad- 
way and  34th  Street.  An  approximate  scale  of  normal  values 
based  on  the  consideration  that  each  thousand  of  population 
adds  from  $10  to  $12  to  the  front  foot  value  of  the  best  business 
locations  and  from  $1  to  $2  to  the  front  foot  value  of  the  best 
residence  locations  would  be  as  follows,  It  being  understood  that 
the  application  of  any  such  scale  Is  limited  in  practice  by  differ- 
ences in  wealth,  character  of  industries  and  inhabitants,  topog- 
raphy, transportation,  platting,  climate,  etc. 


TABLE  I. 

Best  business, 

Best  residences. 

City  population. 

per  front  ft. 

per  front  ft. 

26.000 

$300  to     $400 

$25  to     $40 

50.000 

fiOOto    1.000 

40  to       75 

100,000 

1.200  to    2.000 

75  to     150 

1.50.000 

1.500  to    2.500 

100  to     200 

200,000 

1.800  to    3,000 

100  to     300 

300.000 

2.500  to    4.500 

200  to     500 

600.000 

4.000  to    7.000 

500  to  1.000 

1.000.000 

7.000  to  10.000 

700  to  1.500 

2.000.000 

fl.OOO  to  1 6.000 

1.000  to  2.000 

3.500.000 

18.000  to  35.000 

4.000  to  9.000        1 

SCALE  OF  AVERAGE  VALUES. 


143 


The  proportion  between  land  values  due  to  different  utilities 
varies  widely  indifferent  cities,  evidencing  the  response  of  special 
sections  to  special  forces.  Thus  the  best  business  and  the  best 
residence  land  in  the  same  city  shows  in  New  York,  with  $35,000 
per  front  foot  for  business  and  $9,000  per  front  foot  for  residence 


Minneapolis.     Business  section.     Figures  represent  value  of  corners, 
for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 

land,  a  proportion  of  about  4  to  1;  In  Buffalo  with  $4,500  for 
business  land  and  $500  for  residence  land  a  proportion  of  9  to  1; 
In  Minneapolis  with  $2,500  for  business  and  $100  for  residence 
land  a  proportion  of  25  to  1;  and  in  Seattle  with  $2,000  for  busi- 


144 


PRINCIPLES    OF    CITY    LAND    VALUES. 


ness  and  $100  for  residence,  a  proportion  of  20  to  1.  When  we 
turn  to  southern  cities,  Richmond  with  $1,600  for  business  and 
$300  for  residence  shows  a  proportion  of  5  to  1,  and  Atlanta 
with  $2,000  for  the  best  business  and  $200  for  the  best  residence, 
a  proportion  of  10  to  1. 

As  explaining  this  difference  between  western  and  southern 
cities,  business  is  active  and  progressive  in  western  cities,  pro- 
ducing high  business  values,while  residences  are  scattered  by  the 
trolley  and  are  not  held  together  by  the  old-establshed  residence 
sections,  whereas  in  southern  cities  the  scale  of  business  opera- 
tions is  less,  partly  owing  to  the  diminished  purchasing  power 
of  the  negroes,  resulting  in  low  business  values,  while  residence 
values  are  raised  by  the  greater  importance  attached  to  social 
considerations  and  the  greater  age  of  the  cities.  The  abnormally 
high  values  of  residence  property  in  New  York  testifies  to  its 
limited  quantity  and  to  the  keen  demand  for  it  on  the  part  of 
the  many  millionaires  who  make  New  York  their  home. 

Heavy  wholesale  property  responds  but  feebly  to  increased 
population,  varying  from  $100  to  $400  in  value  in  cities  of  300,- 
000  people  or  under.  Where  values  run  above  these  figures  the 
property  would  include  some  retail  feature.  The  proportion  of 
value  between  the  best  retail  land  and  the  best  wholesale  is, 
therefore,  one  which  increases  with  the  size  of  the  city,  ranging 
from  4  to  1  in  the  smaller  cities,  up  to  10  to  1  in  the  largest. 
Ae  examples  of  the  value  of  the  best  retail,  best  wholesale  and 
best  residence  land  in  various  cities,  the  following  list  of  front 
foot  values  is  submitted. 

TABLE  II. 

Best  Best  Best 

Population.  retail.         wholesale,  residence. 

New  York   3.437,202  $18,000  $3,000  $9,000 

Financial  land 35,000             

Chicago 1.698,575  15,000  2.000  2,000 

Financial  land 8,000             

Philadelphia    ..    ..1.293,697  11,000             2,000 

Washington 278.718  5.000             500 

Louisville    204.731  1.700  400  150 

Minneapolis    202.718  2,500  400  100 

Indianapolis    169,104  2,500  400  150 

Kansas  City 163,752  2.500  450  150 

St.    Paul    163,065  1,800  400  150 

Denver 133,859  1,800  250  100 

Toledo 131.822  2,000  300  '  150 

Memphis 102,320  2.000  400  60 

Portland,    Ore 90.426  1.600  300  70 

Atlanta 89.872  2,000  400  200 

Richmond 85,050  1,800  150  200 

Seattle 80.671  2.000  400  80 

Des  Moines 62.139  1,500  200  75 

Salt  Lake  City 53,531  1,400  200  75 

Duluth 52,969  1.000  300  65 

Spokane 36.848  800  200  60 


CHAPTER  XL 

Summary^ 

Review  of  evolution  of  value  in  city  land,  economic  rent 
factors  of  attraction  and  repulsion. — Value  by  proximity  and 
by  accessibility. — Reactions  of  utilities. — Scope  of  individual 
inquiry.— Problem  always  complex,  change  a  law  of  life.— 
While  conditions  change,  values  will  change.— The  study  of 
principles  should  reduce  errors  in  judgment  to  a  minimum. 

In  reviewing  the  evolution  of  value  in  urban  land,  the  first  step 
is  to  conceive  of  the  naked  site  apart  from  the  buildings,  having 
only  the  qualities  of  location  and  extension  and  without  value 
until  there  is  come  ^tition  for  land.  Intrinsic  value  is  the  capital- 
ization of  the  economic  or  ground  rent,  provided  the  buildings 
are  suitable  to  the  location.  Bxchan  :e  value  consists  of  intrinsic 
value  modified  by  future  prospects.  Ground  rent  is  the  residuum 
after  deducting  from  gross  rents  all  operating  charges,  taxes, 
insurance,  repairs,  rent  collecting,  and  interest  on  the  capital 
invested  in  the  building.  Ground  rent  is  a  premium  paid  solely 
for  location  and  all  rents  are  based  on  utility.  Utilities  in  cities 
tend  constantly  toward  specialization  and  complexity,  business 
being  broadly  divided  into  distribution,  administration  and  pro- 
duction, and  then  indefinitely  subdivided;  and  residences  being 
divided  into  as  many  classes  as  there  are  social  grades. 

Insofar  as  land  is  suitable  for  a  single  purpose  only,  its  value 
is  proportionate  to  the  degree  to  which  it  serves  that  purpose 
and  the  amount  which  such  utility  can  afford  to  pay  for  it 
When  land  is  suitable  for  a  number  of  purposes,  one  utility  com- 
petes against  another  and  the  land  goes  to  the  highest  utiliza- 
tion. 

The  total  value  of  a  city's  site  is  broadly  based  on  population 
and  wealth,  the  physical  city  being  the  reflex  of  the  total  social 
activities  of  its  inhabitants.  Whatever  the  type  of  city,  growth 
consists  of  movement  away  from  the  point  of  origin  and  is  of 
two  kinds:  central,  or  in  all  directions,  and  axial,  or  along  the 
watercourses,  railroads  and  turnpikes  which  form  the  framework 
of  cities.  Modern  rapid  transit  stimulates  axial  growth,  produc- 
ing star-shaped  cities,  whose  modification  in  shape  comes 
chiefly  from  topographical  faults. 

The  factors  distributing  values  over  the  city's  area  by  attrac- 
ting or  repulsing  various  utilities,  are,  in  the  case  of  residences, 

11 


146 


PRINCIPLES    OF    CITY    LANB   VALUES. 


absence  of  nuisances,  good  approach,  favorable  transportation 
facilities,  moderate  elevation  and  parks;  in  the  case  of  retail 
shops,  passing  streettraffic,  with  a  tendency  towards  proximity  to 
their  customers'  residences;  in  the  case  of  retail  wholesalers  and 
light  manufacturing,  proximity  to  the  retail  stores  which  are 
their  customers;  in  the  case  of  heavy  wholesaling  or  manufac- 
turing, proximity  to  transportation;  and  in  the  case  of  public 


\  PJEW  ORILEAKIS.iA.| 


New  Orleans.     Business  section.    Figures  represent  value  of  corners, 
for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


or  semi-public  buildings,  for  historical  reasons,  proximity  to  the 
old  business  centre;  the  land  that  is  finally  left  being  filled  in 
with  mingled  cheap  utilities,  parasites  of  the  stronger  utilities, 
which  give  a  low  earning  power  to  land  otherwise  valueless. 

Value  by  proximity  responds  to  central  growth,  diminishing 
in  proportion  to  distance  from  various  centres,  while  value  from 
accessibility  responds  to  axial  growth,  diminishing  in  propor- 
tion to  absence  of  transportation  facilities.    Change  occurs  not 


SUMMARY. 


147 


COG 

nan 


snnnnnnnnn[ 

I  L_l  LJ  LJ  L.J  I I  [saTt  lake  city 

nnnnBDL- 


_  ^t'^^t 


Salt  Lake  City.    Residence  section.     Figures  represent  value  of  cor- 
ners, for  lot  of  average  width  and  depth,  in  dollars    per  front  foot. 


148 


PRINCIPLES    OF    CITY    LAND    VALUES. 


only  at  the  circumference  but  throughout  the  whole  area,  of  a 
city,  outward  growth  being  due  both  to  pressure  from  the  centre 
and  to  aggregation  at  the  edges.  All  buildings  within  a  city 
react  upon  each  other,  superior  and  inferior  utilities  displacing 
each  other  in  turn.  Whatever  the  size  or  shape  of  a  city  and 
however  great  the  complexity  of  its  utilities,  the  order  of  de- 
pendence of  one  upon  another  is  based  on  simple  principles, 


Seattle.      Residence   section.      Figures   represent  value    of   corners, 
for  lot  of  average  width  and  depth,  in  dollars,  per  front  foot. 


all  residences  seeking  attractive  surroundings  and  all  business 
seeking  its  customers. 

While  the  outward  glacial  movement  of  a  city  continues,  the 
daily  currents  of  travel  within  alter  its  internal  structure.  The 
fluidity  of  daily  traffic  shifts  utilities,  creates  plastic  conditions 
in  cities  and  keeps  values  in  a  state  of  unstable  equilibrium. 

To  look  at  the  problem  from  the  individual  standpoint,  in  at- 
tempting to  state  the  value  of  any  single  property,  the  inquiry 


SUMMARY. 


149 


would  seek  first,  upon  what  forces  does  the  city  itself  depend, 
how  permanent  are  they,  how  diversified,  are  they  strengthening 
and  what  is  the  resulting  index  figure,  to  wit,  the  rate  of  increase 
of  the  city's  population;  next,  what  are  the  characteristics  of  the 
section  of  the  city  in  which  the  property  is  located,  its  past  his- 
tory, its  present  stability,  its  future  prospects;  what  is  the  cen- 
tral strength  of  the  property,  how  near  the  main  centre  of  the 
city  or  the  various  su^centers  of  attraction;   what  is  its  axial 


ICHMOND  VA. 


K.e.Slp>g"NCe.  3E.CT10N 


Riclnnond,  Va.  Residence  section.  Figures  represent  value  of 
corners,  /for  lot  of  average  width  and  depth,  in  dollars  per  front 
foot. 


Strength,  the  quantity,  quality  and  regularity  of  the  passing 
travel,  what  is  the  character  of  building  on  the  property  as  to 
suitability,  planning,  physical  condition,  prospect  of  changing 
utility,  management,  convertibility,  gross  and  net  income;  at 
what  prices  have  surrounding  property  been  selling,  are  they  ris- 
ing or  falling,  and  do  they  suggest  any  factors  not  yet  taken 
into  account;  is  the  property  liable  to  be  injured  or  benefited 
by  changes  in  the  building  laws;  is  there  any  special  enterprise 
or  strength  on  the  part  of  the  owner  or  of  surrounding  owners 
likely  to  affect  the  property,  what  would  be  the  probable  effect 


Columbus,  O.    Residence  section.      Figures  represent  value  of  corners,  for  lot  of  average  width 

and  depth,  in  dollars  per  front  foot. 


Atlanta.     Residence  section.    Figures  represent  value  of  corners,  for 
lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


Toledo.    Residence  section.     Figures  represent  value  of  corners,  for  lot  of  average  width  and 

depth,  in  dollars  per  front  foot. 


.^-,1, 


a^ssi 


Al 


■TunnonnGooQDDr 

Y 

r 


DODQnOOOOi 


fKansas  City,  Mo.    Residence  section.    Figures  represent  value  of  corners,  for  lot  of  average 
width  and  depth,  in  dollars  per  front  foot. 


3Hr 


™g^^l™ 


Minneapolis.    Residence   sections.     Figures  represent  value  of  corners,  for  lot  of  averkge  width 

depth,  in  dollars  per  front  f«ot. 


NEW  0RLEAN5.LA 

feet 


New    Orleans. 


Residence    section    in    American    quarter.     Figures    represent  value  of  corners 
for  lot  of  average  width  and  depth,  in  dollars  per  front  foot. 


156  PRINCIPLES  OP  CITY  LAND  VALUES. 

of  any  inventions  or  improvements  in  transportation  or  the  con- 
struction of  buildings,  and,  finally,  what  are  the  general  com- 
mercial conditions  as  affecting  the  earning  power  of  tenants, 
actual  or  prospective,  and  financial  conditions  as  affecting  the 
capitalization  rate. 

The  problem  is  never  a  simple  one,  being  as  complex  as  city 
life  itself,  but  it  is  not  insoluble,  since  the  forces  creating 
cities  are  governed  by  uniform  laws,  like  causes  producing  like 
results,  apparent  exceptions  being  due  to  the  influence  of  factors 
\  not  reckoned  on.  The  popular  impression  that  the  ability  to 
j  forecast  future  movements  of  city  growth  points  a  quick  way  to 
I  fortune  is  an  over  estimate,  since  real  estate  movements  are 
slow,  large  capital  is  required  to  handle  it,  carrying  charges  are 
heavy,  and  even  though  the  forecast  may  be  ultimately  correct, 
the  rate  of  movement  is  uncertain,  depending  on  the  operation 
of  vast  economic  forces  impossible  of  exact  prediction. 
I  If  business  expands  and  population  increases  in  a  city,  the  sum 
total  of  land  values  is  certain  to  increase.  All  the  land,  however, 
will  by  no  means  increase  in  value,  the  great  mass  of  medium 
business  and  residence  property  advancing  but  slowly  since  it 
supplies  the  wants  of  a  large  number  of  people  of  moderate 
earning  power  who  cannot  pay  beyond  a  certain  price.  Coin- 
cident with  the  gradual  lifting  of  values  as  population  becomes 
more  dense,  decaying  sections,  left  behind  in  the  onward  march, 
drop  down  the  scale  of  inferior  utilities  and  values,  sometimes 
to  the  point  of  extinction.  Such  worn-out  property  exhibits  in 
its  dilapidations  both  absence  of  utility  and  public  confession 
of  that  fact.  If  population  and  business  become  stationary  the 
sum  total  of  land  values  will  decrease  in  proportion  to  the  pre- 
vious discounting  of  future  growth,  subsequent  movements  con- 
sisting of  redistribution  of  value,  as  one  part  of  the  city  or  an- 
other, or  one  individual  or  another,  flourishes  or  declines. 

The  principal  causes  of  the  redistribution  of  value  in  all  cities 
are,  increase  in  population  and  wealth,  especially  in  causing  re- 
location or  extension  of  the  best  residence  district,  changes  in 
transportation,  such  as  new  surface,  elevated,  or  underground 
lines,  new  bridges,  tunnels,  ferries  and  railroads,  and  the  read- 
justments of  new  utilities  in  new  areas  harmonizing  the  complex 
contending  factors. 

Present  tendencies  point  towards  greatly  increased  values  at 
strategic  points,  with  relative  and  frequently  absolute  drops  in 
value  in  locations  formerly  competitive.  The  quiet  side  streets, 
the  back  alleys  and  deserted  nooks  and  corners  where  land  has 
almost  no  value,  despite  its  proximity  to  valuable  land,  will  doubt- 
less continue  at  their  present  low  planes,  unless  they  are  either 


Map  Showing  Value  per  Square  Foot  in  Dollars  of  New  York  Real 

Estate. 


158 


PRINCIPLES  OF  CITY  LAND  VALUES. 


Map  Showing  Value  per  Square  Foot  in  Dollars  of  New  York  Real   Estate. 


SUMMARY.  159 

reached  by  the  spreading  growth  from  some  centre  or  are  inter- 
sected by  some  new  traffic  street. 

The  point  of  highest  value,  responding  in  scale  and  location 
to  the  growth  of  the  city,  moves  from  the  first  business  centre 
towards  the  best  residence  district,  the  crest  of  the  wave  being 
usually  the  middle  of  the  retail  shopping  district,  frequently 
strengthened  by  exceptionally  large  and  handsome  buildings, 
and  occasionally  checked  by  cross  traffic  streets.  Apart  from 
any  factors  which  may  deflect  the  line  of  growth,  the  land  lying 
in  its  path  is  certain  to  increase  in  value,  the  time  of  such  in- 
crease, however,  being  difficult  to  gauge,  while  the  land  left  be- 
hind will  usually  sink  in  value,  although  in  the  largest  cities, 
while  decreasing  relatively  in  value  and  utility,  it  sometimes 
increases  slightly  in  absolute  value.  New  York,  the  one  financial 
centre  of  the  country,  is  an  exception  in  that  its  financial  land 
is  more  valuable  than  its  shopping  land. 

New  inventions  and  new  habits  and' customs  will  probably 
cause  the  most  marked  future  changes  other  than  those  due  to 
growth  or  transportation.  All  cheapening  of  the  cost  of  build- 
ings, all  improvements  in  construction,  all  inventions,  tend  con- 
stantly to  destroy  the  value  of  existing  buildings.  ^11  improve- 
ments in  transportation,  such  as  the  trolley,  the  elevated,  the 
underground,  the  bicycle,  the  automobile — and  in  future  possibly 
the  flying  machine — tend  to  destroy  the  value  of  these  locations 
which  depend  on  existing  transportation!]  All  changes  in  social 
customs,  such  as  longer  summer  absences  from  the  city,  shift 
values,  as  in  this  instance  from  the  city  to  the  summer  resorts. 
The  great  interchange  of  travel  throughout  the  year  from  one 
city  to  another  strengthens  the  radiating  influence  of  the  hotels, 
while  the  movement  from  residences  to  flats  and  apartments, 
concentrates  population  and  augments  the  power  of  capital  ta 
attract. 

Change  is  a  law  of  life,  and  as  long  as  human  activity  con- 
tinues to  alter  the  conditions  of  city  life,  and  human  tastes, 
prejudices,  fashions,  habits  and  customs  continue  to  vary,  city 
structure  and  values  will  shift  and  change,  but  the  study  of  the 
basic  principles  of  city  growth  should  reduce  errors  in  fore- 
casting to  a  minimum,  permitting  well  equipped  intelligence, 
whether  in  buying,  selling,  renting,  loaning  on,  or  in  any  way 
dealing  with  city  real  estate,  to  largely  eliminate  the  power  of 
chance. 


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